Which Consumer Staple Stock Has the Strongest Earnings Trends: Procter & Gamble, Kimberly-Clark or Colgate-Palmolive?

January 30, 2013

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Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

Stocks with improving earnings metrics are worthy of your extra attention. Click here to discover our CHEAT SHEET stock picks now!

Here’s your Cheat Sheet to how the top 3 consumer staple stocks rank via earnings trends:

Procter & Gamble Co. (NYSE:PG): Current Price $75

Fiscal Year	2008	2009	2010	2011	2012
Revenue ($) in millions	79,260	76,690	77,570	81,100	83,680
Diluted EPS ($)	3.64	4.26	4.11	3.93	3.66

Procter & Gamble has shown a rising revenue trend after 2009. Unfortunately, EPS is quite another story, falling off every year for the last four years.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter	Dec. 31, 2011	Mar. 31, 2012	Jun. 30, 2012	Sep. 30, 2012	Dec. 31, 2012
Revenue ($) in millions	21,740	20,190	20,210	20,740	22,180
Diluted EPS ($)	0.57	0.82	1.24	0.96	1.39

Quarterly revenue numbers are all over the place, though EPS climbed nicely between December 2011 and June 2012. Profits took a hit in the latest September, but earnings are now increasing quarter-over-quarter…

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