The world’s largest consumer-goods company, Procter&Gamble published its results for the second quarter ended december 31. P&G reported a profit of $1.69 billion, 0.57 cents per share, down from a profit of $3.33 billion ($1.11 per share), a year earlier. High commodity costs, negative currency impacts and an important depreciation explain this decrease.
Even if the group has reduced its EPS forecasts ($0.91-$0.97 cents below the $1.06 expected by Thomson Reuters) for its Q3, business expectations are well, as the income statement evolution chart (financials heading) remarked.
From a fundamental viewpoint, the company is trading at a high level as shown by the ratio “enterprise value/revenue” is 2.38x in 2012 and the price earning ratio is estimated at 15.9x. According to Thomson Reuters' consensus, the average target price is fixed at $71.1 which represents 12% potential.
The share rose to $66.95 resistance until the end of december bolstered by general upward trend on U.S stocks markets. Since this movement, the stock has dropped to $62.70 support which has been successfully tested several times, showing its pertinence.
In this context, the buyers could place an order close to the support and to aim at $66.95. This technical rebound configuration might be an opportunity for investors with a stop loss fixed at $62.
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Procter & Gamble Company is one of the world's leaders in producing and selling consumer products. Net sales break down by family of products as follows:
- care and hygiene products (38.3%): oral hygiene products (toothpastes, toothbrushes, mouthwashes, etc.; Crest, Oral-B, Scope brands, etc.), pharmaceutical products (Metamucil, Neurobion, Pepto Bismol, Vicks, etc.), toilet training pants (Luvs, Pampers), toilet papers and paper towels (Bounty, Charmin, Puffs), feminine protection products (Always, Always Discreet and Tampax), etc.;
- home care and laundry products (34.6%): dishwashing liquids, detergents, stain removers, fabric softeners, deodorizers, bleaches, etc. (Ariel, Downy, Gain, Tide Cascade, Dawn, Fairy, Febreze, Mr. Clean, Swiffer, etc.);
- beauty products (18.3%): hair care products (shampoos, colorings, and cream rinses; Head & Shoulders, Herbal Essences, Pantene and Rejoice brands), body care (soaps, shower gels, deodorants, etc.; Camay, Zest, Secret, Old Spice) and cosmetics (make-up and facial care; Max Facto, Covergirl and Olay);
- shaving products (7.8%): blades, razors, batteries, etc. (Braun, Gillette and Venus brands);
- other (1%).