Investing

Procter & Gamble Trades Higher but Remains Dow's Laggard

Paul Ausick

Published: July 28, 2018 8:50 am

Last Updated: January 11, 2020 8:14 pm

Consumer products giant Procter & Gamble Co. (NYSE: PG) had a pretty good week, at least as far as its share price was concerned. The worst-performing stock year-to-date on the Dow Jones industrials index added about 2.4% to its share price. That was not enough, though, to let it escape the cellar — shares are still down 12.3% since the beginning of 2018.

The second-worst Dow stock so far this year is 3M Co. (NYSE: MMM), which is down 11.9%. That is followed by Walmart Inc. (NYSE: WMT), down 10.8%, Caterpillar Inc. (NYSE: CAT), down 9.5%, and McDonald’s Corp. (NYSE: MCD), down 8.5%. Of the 30 Dow stocks, 13 are showing a loss to date in 2018.

The blue-chip index added nearly 393 points over the course of the past week to close at 25,451.06, up about 1.5% from the previous Friday’s close. The Dow closed up less than 1% for the second quarter but down 1.8% for the first six months of 2018. For the year to date, the index is up just 0.4%.

Generally speaking, P&G’s story last week was one of “no news is good news.” Competitor Kimberly-Clark reported earnings last week that revealed weakening margins, and Colgate-Palmolive’s earnings were marred by light revenues.

P&G reports fourth-quarter earnings on Tuesday, and analysts are looking for earnings per share (EPS) of $0.90 and revenues of $16.54 billion. For the full year, the consensus estimates so far call for EPS of $4.18 and revenue of $66.84 billion.

The most recent analyst ratings changes on the stock were all negative. Citigroup lowered P&G’s price target from $98 to $89 while still maintaining its Buy rating. UBS downgraded the stock from Buy to Neutral and kept its $83 price target. Jefferies lowered its rating from Buy to Hold and maintained its $95 price target.

P&G stock closed at $80.58 on Friday, up about 0.6% for the day, in a 52-week trading range of $70.73 to $94.67. The 12-month consensus price target on the stock is $81.38.