Procter & Gamble Prepares to Deliver Big Earnings Report

S&P 500 (NYSE:SPY) component Procter & Gamble (NYSE:PG) will unveil its latest earnings on Thursday, October 25, 2012. Procter & Gamble sells and markets consumer products such as pharmaceuticals, cleaning supplies, personal care, and pet supplies in more than 180 countries.

Procter & Gamble Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 96 cents per share, a decline of 6.8% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $1.03. Between one and three months ago, the average estimate moved down. It has been unchanged at 96 cents during the last month. Analysts are projecting profit to rise by 1.6% versus last year to $3.91.

Past Earnings Performance: The company’s quarterly results have come in above estimates for the last three quarters. Last quarter, the company booked profit of 82 cents per share versus a mean estimate of net income of 77 cents per share.

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A Look Back: In the fourth quarter of the last fiscal year, profit rose 44.7% to $3.63 billion ($1.24 a share) from $2.51 billion (84 cents a share) the year earlier, exceeding analyst expectations. Revenue fell 3.1% to $20.21 billion from $20.86 billion.

Stock Price Performance: Between July 26, 2012 and October 19, 2012, the stock price rose $4.01 (6.2%), from $64.56 to $68.57. The stock price saw one of its best stretches over the last year between August 2, 2012 and August 10, 2012, when shares rose for seven straight days, increasing 5.1% (+$3.26) over that span. It saw one of its worst periods between October 5, 2012 and October 12, 2012 when shares fell for six straight days, dropping 2.4% (-$1.69) over that span.

Wall St. Revenue Expectations: Analysts predict a decline of 5.3% in revenue from the year-earlier quarter to $20.76 billion.

Key Stats:

Last quarter’s earnings rise was a switch from preceding drops, so the upcoming earnings announcement is a chance to build on last quarter’s result. Net income fell in the first quarter of the last fiscal year, the second quarter of the last fiscal year and the third quarter of the last fiscal year before snapping that run with a profit increase in the fourth quarter of the last fiscal year.

On the top line, the company is hoping to use this earnings announcement to snap a string of two-straight quarters of revenue declines. Revenue fell 0.2% in the third quarter of the last fiscal year and dropped again in the fourth quarter of the last fiscal year of the last fiscal year.

Analyst Ratings: With 10 analysts rating the stock as a buy, two rating it as a sell and 11 rating it as a hold, there are indications of a bullish outlook.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.88 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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