Will Anyone Understand P&G Earnings?

Thomson Reuters has consensus earnings estimates of $0.95 in earnings per share and $17,98 billion in revenues. This would compare to the results for same quarter a year ago of $0.93 EPS and $20.16 billion in revenue. Estimates for the coming quarter are $1.04 in earnings per share and $19.12 billion in revenues.

P&G name has seen its shares fall from a peak of close to $90 to around $80 of late, but shares are also above the lows that were under $78 at the start of June. With shares at $80.29, the consensus analyst price target is $88.00 and the 52-week range is $77.10 to $93.89.

Investors also need to consider that P&G is among the few mega-cap stocks with its $218 billion market cap. Also under consideration is that P&G sold Duracell to Berkshire Hathaway Inc. (NYSE: BRK-A) for a deal of $3 billion that had an all-in value of roughly $4.7 billion when the stock swap was considered.

Procter & Gamble also announced earlier in July that it would be selling some 43 of its beauty brands to Coty Inc. (NYSE: COTY). The transaction includes P&G’s global salon professional hair care and color, retail hair color, cosmetics and fine fragrance businesses, along with select hair styling brands.

In the past year, P&G has been lopping off lower growth and non-core brands to focus on its core portfolio. While parting with these beauty brands really seems like a natural progression for P&G at a time when investors want growth, even if that growth is engineered, it also will be the devil’s game for analysts trying to pinpoint the real estimates going forward.

P&G is targeting to pay dividends and retire shares worth up to $70 billion during fiscal years 2016 to 2019 through a combination of shares being eliminated. Still, some considered its dividend hike in April a bit of a disappointment.

P&G was recently named as a runner-up against smaller rival Kimberly-Clark Corp. (NYSE: KMB) in the 24/7 Wall St. 10 Stocks to Own for the Next Decade. Last week Kimberly-Clark managed to beat earnings expectations but with narrower guidance. Unfortunately Kimberly-Clark’s earnings report did not give enough cover or clarity to make any stark revelations in P&G.