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Procter & Gamble (PG) Up More Than 34% in a Year on High Demand
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Shares of The Procter & Gamble Company (PG - Free Report) have gained 34.6% in a year’s time, outperforming the industry’s growth of 29.7%. This can be attributable to continued demand for hand soaps, detergents and surface cleaning products during the pandemic. Also, growth of premium home care products and appliances along with strength in the North American business mainly due to an increase in the pandemic-led consumption bodes well. These factors aided organic sales growth across all 10 product categories and business segments in second-quarter fiscal 2021. Moreover, e-commerce sales increased nearly 50% for the first half of fiscal 2021.
Further, this Zacks Rank #3 (Hold) company remains focused on productivity and cost-saving plans through its second five-year (fiscal 2017-2021) productivity program. The plan targets cutting costs in areas, including the supply chain and cost of goods sold (COGS), marketing and digitization, and promotional spend effectiveness. Notably, the company’s core currency-neutral gross and operating margins reflected significant gains from productivity savings and pricing in second-quarter fiscal 2021.
As a result, improved margins and robust top-line growth led to impressive fiscal second-quarter results, wherein earnings and sales improved year over year. While the company has reported an earnings surprise for the past several quarters, this marked the third straight quarter of a revenue beat. Sales were aided by strength across all segments coupled with robust shipments, pricing and mix.
Encouragingly, management raised its outlook for fiscal 2021. The company now anticipates all-in sales growth of 5-6% compared with the previously mentioned 3-4% increase. It now predicts organic sales growth of 5-6% versus a 4-5% rise mentioned earlier. Earnings per share on a reported basis are now expected to increase 8-10% compared with 4-9% growth stated previously. Core earnings per share for fiscal 2021 are now projected to grow 8-10% compared with a 5-8% increase mentioned earlier.
Despite such upsides, the company continues to reel under COVID-related costs. Higher freight costs to the tune of $100 million and $150 million from the combined impact of rising interest expenses and reduced interest income are likely to weigh on the fiscal 2021 bottom line. Apart from these, the fiscal second quarter reflected impacts of unfavorable currency, which are likely to persist. In fact, the fiscal 2021 core earnings per share view takes into account after-tax headwinds of $100 million stemming from currency woes.
Compania Cervecerias Unidas, S.A. (CCU - Free Report) , also a Zacks Rank #2 stock, has an expected long-term earnings growth rate of 10.2%.
The Estee Lauder Companies (EL - Free Report) has a long-term earnings growth rate of 10.7% and currently, a Zacks Rank #2.
Time to Invest in Legal Marijuana
If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.
After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%.
You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.
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Procter & Gamble (PG) Up More Than 34% in a Year on High Demand
Shares of The Procter & Gamble Company (PG - Free Report) have gained 34.6% in a year’s time, outperforming the industry’s growth of 29.7%. This can be attributable to continued demand for hand soaps, detergents and surface cleaning products during the pandemic. Also, growth of premium home care products and appliances along with strength in the North American business mainly due to an increase in the pandemic-led consumption bodes well. These factors aided organic sales growth across all 10 product categories and business segments in second-quarter fiscal 2021. Moreover, e-commerce sales increased nearly 50% for the first half of fiscal 2021.
Further, this Zacks Rank #3 (Hold) company remains focused on productivity and cost-saving plans through its second five-year (fiscal 2017-2021) productivity program. The plan targets cutting costs in areas, including the supply chain and cost of goods sold (COGS), marketing and digitization, and promotional spend effectiveness. Notably, the company’s core currency-neutral gross and operating margins reflected significant gains from productivity savings and pricing in second-quarter fiscal 2021.
As a result, improved margins and robust top-line growth led to impressive fiscal second-quarter results, wherein earnings and sales improved year over year. While the company has reported an earnings surprise for the past several quarters, this marked the third straight quarter of a revenue beat. Sales were aided by strength across all segments coupled with robust shipments, pricing and mix.
Encouragingly, management raised its outlook for fiscal 2021. The company now anticipates all-in sales growth of 5-6% compared with the previously mentioned 3-4% increase. It now predicts organic sales growth of 5-6% versus a 4-5% rise mentioned earlier. Earnings per share on a reported basis are now expected to increase 8-10% compared with 4-9% growth stated previously. Core earnings per share for fiscal 2021 are now projected to grow 8-10% compared with a 5-8% increase mentioned earlier.
Despite such upsides, the company continues to reel under COVID-related costs. Higher freight costs to the tune of $100 million and $150 million from the combined impact of rising interest expenses and reduced interest income are likely to weigh on the fiscal 2021 bottom line. Apart from these, the fiscal second quarter reflected impacts of unfavorable currency, which are likely to persist. In fact, the fiscal 2021 core earnings per share view takes into account after-tax headwinds of $100 million stemming from currency woes.
Other Stocks to Consider
Constellation Brands (STZ - Free Report) currently has an expected long-term earnings growth rate of 7.4% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Compania Cervecerias Unidas, S.A. (CCU - Free Report) , also a Zacks Rank #2 stock, has an expected long-term earnings growth rate of 10.2%.
The Estee Lauder Companies (EL - Free Report) has a long-term earnings growth rate of 10.7% and currently, a Zacks Rank #2.
Time to Invest in Legal Marijuana
If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.
After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%.
You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.
Today, Download Marijuana Moneymakers FREE >>