Procter & Gamble (NYSE: PG) has reported earnings for its second quarter and the consumer products giant has turned in earnings of $0.57 EPS but the normalized earnings was $1.10 EPS on $22.14 billion in sales.  Thomson Reuters had estimates of $1.08 EPS and $22.19 billion in sales.

On an adjusted basis, P&G sees Fiscal 2012 earnings of $4.00 to $4.10 EPS and total sales up about 3% to 4%.  Thomson Reuters has a consensus earnings estimate of $4.17 EPS and $86.15 billion.  That would be a tad light on earnings and up to $1 billion light on revenues.

Higher commodity costs are expected to be a drag on third quarter earnings and a unfavorable product mix and an unfavorable geographic mix are all also dragging on earnings for the current quarter.  For the rest of the year, foreign exchange is expected to hurt sales by about 3% to 4%.

Rival Kimberly-Clark Corporation (NYSE: KMB) already took it on the chin this week after its earnings, while Colgate-Palmolive Company (NYSE: CL) has traded higher after its earnings.  Many investors have been moving to more risk-trade investments rather than defensive stock trades this week after Ben Bernanke telegraphed that the FOMC believes interest rates will remain exceptionally low through the end of 2014.

Kimberly-Clark now yields almost 4% and P&G yields about 3.2%, while Colgate-Palmolive yields almost 2.7%. 

P&G shares are indicated down 1.3% at $63.95 and the 52-week trading range is $57.56 to $67.72.

JON C. OGG

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