With hundreds of companies having reported quarterly results, we're now in the heart of earnings season. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed, knee-jerk decision.

Let's turn to Procter & Gamble (NYSE:PG). With its gain of 5% coming in a bit shy of the performance of the Dow Jones Industrials (DJINDICES:^DJI) in 2012, P&G has received an unusual amount of attention from investors seeking to get the company to take steps to improve its future results. Let's take an early look at what's been happening with Procter & Gamble's over the past quarter and what we're likely to see in its quarterly report on Friday.

Stats on Procter & Gamble

Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$21.89 billion

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo Finance.

Will Procter & Gamble move the markets?
P&G has inspired confidence among analysts, as estimates have climbed slightly over the past few months. Having delivered four straight earnings beats, including a massive $0.10 per-share positive surprise in the September quarter, P&G is nevertheless expected to show just minimal year-over-year growth. Investors are similarly cautious: The stock has gained just 3% since mid-October.

Investors' concern owes partly to P&G's lack of an aggressive response to challenging conditions. Industrywide, P&G shares the same problem of high-cost raw materials as Unilever and Colgate-Palmolive, but P&G hasn't done as good of a job as those rivals in focusing attention on faster-growing emerging markets. Despite its worldwide brand presence, P&G needs to do more to shore up its once-dominant position in many areas around the world.

Investors will also need to read between the lines of P&G's report to see whether or how it's responding to attention from Bill Ackman. Although Ackman has seemingly directed most of his efforts toward Herbalife lately, his criticism of P&G leadership may draw responses from CEO Robert McDonald in his conference-call comments.

Procter & Gamble has made investors nervous with its uncharacteristically tentative behavior. Look for signs that the company is reversing that trend for the long run before you get too excited about whatever P&G reports on Friday.

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