There's no sign of a growth slowdown yet in Procter & Gamble's (PG 0.62%) business. Investors were feeling cautious heading into the consumer staples giant's fiscal second-quarter report this week on worries that its sales spike might be ending soon. But P&G instead turned in another quarter of surprisingly strong revenue and profit metrics that convinced management to raise its 2021 outlook -- and cash return targets -- a second consecutive time.

Let's dive right in.

Dominating several global niches

P&G's big-picture growth rate stayed elevated, with organic sales landing at 8%, or just slightly below the 9% surge the company achieved in its fiscal first quarter. That boost beat management's expectations and likely translated into market-share wins against rivals like Kimberly-Clark, which has been growing sales at a 6% rate in recent quarters .

A man cleans a kitchen counter.

Image source: Getty Images.

Zoom in, and the picture looks even brighter for P&G. It dominated in the fabric and home care division that's home to the Tide franchise. But each of its five core segments achieved solid growth, balanced between higher volume and rising prices.

Even the baby care segment, its worst performer last quarter, improved market share. "We delivered another strong quarter of results across all key measures," CEO David Taylor said in a press release .

Under the hood

The financial news was better than investors might assume by just glancing at the 4% increase that P&G announced in reported earnings. That figure was held back by one-time debt-repayment charges and currency exchange rate swings. Strip those out, and core earnings jumped 18% in the quarter.

That surge reflected higher gross profit margin due to rising prices, lower costs, and a demand shift toward more expensive cleaning and maintenance products. P&G also reduced selling expenses and cut marketing costs. These positive trends all combined to push operating margin up by 2.6 percentage points to over 27% of sales.

Cash flow was strong, as usual. P&G converted over 100% of its earnings into free cash, helping push that figure to nearly $5 billion for the quarter.

Looking ahead

The improving cash figure now has management expecting to return about $18 billion to shareholders this year through dividends and stock buybacks -- up from the prior $16 billion target. But Taylor and his team didn't stop there. They also raised their sales and earnings forecasts for the fiscal year that laps some of the biggest COVID-19 demand spikes from last spring.

P&G now sees organic sales rising by 4% to 5%, or about 1 percentage point faster than executives predicted three months ago. Earnings got a similar upgrade and are on pace to rise by 8% to 10% in fiscal 2021.

This report hit all the right notes for investors who might have been worried about a hard landing in 2021 compared to last year's blockbuster result. P&G is on track to turn in another year of market-share gains, accelerating growth, and surging earnings instead. Those are all trends that should support solid returns for shareholders looking for an attractive dividend stock to hold through what could be a turbulent year for the global economy.