Procter & Gamble Beats Earnings Estimate With Continued Pandemic Cleaning Demand

Solid cash results despite challenging operating environment

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Graham Griffin
Apr 20, 2021
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Consumer product giant Procter & Gamble Co. (

PG, Financial) has released earnings that beat analyst estimates as of Tuesday.

The company reported earnings of $1.26 per share, a 13% increase from the year prior, that beat estimates of $1.19 per share. Net sales landed at $18.1 billion and beat estimates alongside 2020's net sales during the first quarter of $17.21 billion.

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"We delivered another quarter of solid top-line, bottom-line and cash results in what continues to be a challenging operating environment," Chairman, President and CEO David Taylor said. "We remain focused on executing our strategies of superiority, productivity, constructive disruption and improving P&G's organization and culture. These strategies enabled us to build strong business momentum before the COVID crisis and accelerate our progress during the crisis, and they remain the right strategies to deliver balanced growth and value creation over the long term."

The company's beauty segment reported organic sales growth of 7% compared to the year-ago quarter. The growth was driven by the super premium SK-II brand alongside an increase in pricing in North America Skin Care. Hair care also saw organic sales increase in China.

Fabric, health care and home care all grew during the quarter as well. Home care sales grew thanks in part to increased consumer demand for home cleaning products during the pandemic.

The one segment to see organic sales decrease was baby, feminine and family care. Low retailer inventories were to blame alongside competitive activity during the quarter.

Looking to the rest of the year, Procter & Gamble continues to expect organic sales growth in the range of 5% to 6% compared to the year prior. The company expects dividend payouts to break $8 billion, bringing the total return of cash flow for shareowners to approximately $19 billion.

On April 20, the stock was trading at $137.29 per share with a market of $338.22 billion. According to the GF Value Line, the shares are trading at a modestly overvalued rating.

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Top gurus invested in Procter & Gamble include Mario Gabelli (Trades, Portfolio), Yacktman Asset Management (Trades, Portfolio) and Jim Simons (Trades, Portfolio).

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Disclosure: Author owns no stocks mentioned.

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