Analyst Andrea Teixeira and her team believe the company is poised to accelerate organic sales growth, improve margin rates in the medium term, and see re-rating back to historical valuation multiples.

“We believe there is upside to consensus longer term as categories are recovering growth in the U.S. We believe PG will regain market share given its strong brand equity, marketing capabilities, and supply chain excellence/resilience positively in the current operating environment,” wrote Texeira.

While cognizant of the slump in consumption, especially in the developed markets, the firm thinks intervention from P&G (PG) management will play a large role in the top line since the company tends to perform ahead of the market given its robust innovation. “Furthermore, PG plays in everyday essentials categories, alluding to consumers returning eventually, and PG remains one of the higher-quality names among our HPC coverage,” updated Texeira.

JPMorgan assigned a price target of $165 to P&G (PG) based on a 50-50 blend of a P/E multiple of 23.1X and an EV/EBITDA multiple of 15.0X.

Shares of Procter & Gamble (PG) were up 1.2% in premarket trading after rising 2.7% yesterday on the heels of its FQ2 earnings report.

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Management View

• CEO Shailesh Jejurikar emphasized confidence in the company’s interventions and investments to improve near-term performance, noting, “We are confident the interventions and investments we are making now will improve our near-term performance, strong innovation supported by sharper consumer communication and retail execution.” Jejurikar highlighted success stories such as Greater China Baby Care, where Pampers Prestige has driven double-digit organic sales growth over the past 18 months, and Mexico fabric enhancers, which achieved double-digit growth through product innovation and sharper brand communication.

• The CEO announced a longer-term reinvention of P&G, describing the initiative as “the next important phase of constructive disruption that will create and extend our competitive advantages in each element of our strategy.” He outlined the company’s intent to leverage data and technology, referencing the buildout of a data lake and AI capabilities, and stated, “We will double down on productivity with multiyear visibility to fund capabilities, innovation and demand creation and to mitigate cost headwinds while delivering financial results at the levels you and we expect.”

• CFO Andre Schulten remarked, “As we expected, second quarter top line results heavily reflect underlying market trends and impacts from base period dynamics.” Schulten noted that the quarter was anticipated to be the softest of the fiscal year, with confidence in stronger growth ahead. He reported that “organic sales were in line with prior year,” and “core earnings per share were $1.88, in line with prior year.” Schulten also shared that P&G returned $4.8 billion of cash to shareowners in the quarter.

Outlook

• CFO Schulten reiterated that fiscal 2026 guidance ranges are unchanged, continuing to expect organic sales growth of in line to plus 4%. He projected global market growth for the company’s portfolio footprint at around 2% on a value basis and expects stronger growth in the U.S. as interventions take hold. The core EPS outlook remains in line to plus 4% versus prior year, or a range of $6.83 to $7.09 per share. Schulten stated, “We expect to pay around $10 billion in dividends and to repurchase approximately $5 billion in common stock, combined a plan to return roughly $15 billion of cash to shareowners in fiscal ’26.”

• The outlook includes approximately $500 million before tax in higher costs from tariffs and a core effective tax rate of 20% to 21%. Adjusted free cash flow productivity is forecast between 85% and 90%.

Financial Results

• P&G’s organic sales were flat year over year, with volume down 1 point, pricing up 1 point, and mix flat. Seven of ten product categories held or grew organic sales. Notably, Family Care was down approximately 10% due to base period dynamics. Excluding Family Care, organic sales rose 1%. North America organic sales declined by 2%, while Latin America and the Europe Enterprise Market region grew 8% and 6%, respectively. Greater China organic sales advanced 3%.

• Core gross margin was down 50 basis points, and core operating margin decreased by 70 basis points. Productivity improvement was 270 basis points, and adjusted free cash flow productivity was 88%.

Q&A

• Lauren Lieberman, Barclays: Asked about the rationale behind expected near-term acceleration and the company’s reinvention. CFO Schulten pointed to strong performance outside the U.S. and said, “The main element here, I think, is the fundamental execution of the same interventions we made outside of the U.S. earlier.” Jejurikar described growth opportunities and a unique chance to leverage shifts in media, technology, and consumer demographics.

• Stephen Powers, Deutsche Bank: Sought more detail on where acceleration is expected and the transformation timeline. Schulten outlined that “the innovation interventions, the commercial interventions, the execution focus is consistently applied across every part of the portfolio,” with Family Care, Baby Care, and Fem Care expected to benefit most in the near term. Jejurikar estimated, “by the time we really get the future evenly distributed, I think we are talking 12 to 18 months.”

• Christopher Carey, Wells Fargo: Asked about investment levels and cost structure. Schulten explained, “Many of the investments have been made over the last decade…The investment to activate the technology, specifically around the innovation capabilities, the media capabilities won’t be significant.”

• Dara Mohsenian, Morgan Stanley: Inquired about U.S. priorities. Jejurikar responded that key interventions include adapting to the new media landscape, innovating with a stronger core and bigger adjacencies, and delivering consumer value without price changes.

Sentiment Analysis

• Analysts frequently pressed for clarity on the pace of U.S. recovery, margin trajectory, and market share, with a slightly cautious tone and focus on execution risk and competitive headwinds.

• Management maintained a confident tone in both prepared remarks and responses, repeatedly stressing confidence in interventions, innovation, and reinvention. Schulten used phrases like “we believe” and “we are confident,” while Jejurikar emphasized, “We know what we need to do, and we are excited by the opportunities ahead.”

• Compared to the previous quarter, analyst tone remains probing, but management’s tone has shifted from cautious optimism to a stronger emphasis on strategic reinvention and technology integration.

Quarter-over-Quarter Comparison

• Guidance for organic sales growth (in line to plus 4%), core EPS range, and financial targets are unchanged from Q1.

• Market share declined 20 basis points this quarter, compared to a 30 basis point decline in Q1. Management confidence has increased regarding U.S. interventions and the timeline for benefits, while reinforcing the need for sharper execution and integration of technology and data.

• Analysts continue to focus on U.S. growth, innovation, and promotional activity, with persistent questions on margin outlook and share recovery.

• Management’s language has evolved to highlight a more comprehensive reinvention and accelerated integration of data-driven strategies.

Risks and Concerns

• Schulten acknowledged “a challenging start to the fiscal year with softer consumer markets, aggressive competition and a dynamic geopolitical landscape.”

• Management noted that the outlook does not anticipate significant currency, commodity, or supply chain disruptions.

• Base period dynamics, particularly in the U.S., have weighed on results, and market share loss remains a concern, though interventions are underway.

Final Takeaway

Procter & Gamble’s leadership emphasized a confident outlook for the remainder of fiscal 2026, maintaining guidance and outlining a major reinvention initiative leveraging data and technology. Interventions in innovation and sharper execution are expected to drive performance improvements, particularly in the U.S., as the company aims for stronger growth and market share gains in the second half of the year. Management is focused on operational rigor, productivity, and building competitive advantage for the long term, while navigating a challenging consumer and competitive landscape.

Read the full Earnings Call Transcript

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Procter & Gamble (PG) turned around a premarket loss after CFO Andre Schulten stated on the company’s earnings call that the household products giant has completed what it fully expects will be the softest quarter of the fiscal year.

On Wall Street, the general vibe of analysts is optimistic that the Cincinnati-based company can see improved results going forward.

BNP Paribas analyst Kevin Gundy said that despite Procter & Gamble’s (PG) muted top-line results and sentiment increasingly tethered to sequential improvement in P&G’s volume performance, the firm sees EPS guidance achievability as high.

Morgan Stanley analyst Dara Mohsenian highlighted that P&G’s (PG) FQ2 results were weak on a year-over-year basis, but the bar was low, and there is room for clear sequential organic sales improvement in the second half of the fiscal year. “Negative FY EPS revisions should be limited with relatively in-line margin results despite topline weakness. US performance will be key going forward, with easier comparisons and a greater innovation pipeline in key areas, but US promotion is picking back up in the HPC sector, and PG still has struggles in some key areas (baby),” wrote Mohsenian.

Evercore ISI analyst Robert Ottenstein pointed to P&G’s (PG) declaration that it has confidence in a strong second half as a positive.

Shares of Procter & Gamble (PG) were up 2.6% at 11:22 a.m. to trade at their highest level of 2026.

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*Other Operating Data Consensus Source: Bloomberg

More on Procter & Gamble

• Procter & Gamble: A Buying Strategy For The Dividend Stock
• Procter & Gamble: The Market Is Wrong – It’s Time To Buy This Compounder (Rating Upgrade)
• Procter & Gamble: A Wide Moat, Solid Business – And Still Not A Buy
• Procter & Gamble falls after warning of challenging consumer and geopolitical environment
• Procter & Gamble Non-GAAP EPS of $1.88 beats by $0.02, revenue of $22.21B misses by $80M

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Procter & Gamble (PG) fell in early trading on Thursday after the household products giant missed FQ2 revenue estimates. “Our results in the second quarter keep us on track to deliver within our fiscal year guidance ranges for organic sales growth, core EPS growth, and adjusted free cash flow productivity in a challenging consumer and geopolitical environment,” noted CEO Jon Moeller.

Organic sales were unchanged in FQ2, missing the consensus estimate for a gain of 0.5%.

Notably, beauty segment organic sales increased 4% year-over-year as hair care organic sales increased mid-single digits driven by volume increases and innovation-driven pricing in Latin America and Europe, partially offset by unfavorable geographic mix. Grooming segment organic sales were unchanged compared to a year ago as innovation-driven pricing, primarily in North America and Europe, was offset by volume declines. The healthcare segment’s organic sales increased 3%. Baby, Feminine, and Family Care segment organic sales decreased 4%. Baby Care organic sales decreased in low single digits due to a unit volume decrease and unfavorable geographic mix, partially offset by higher pricing, primarily in North America.

The Cincinnati-based company reported core gross margin for the quarter decreased 50 basis points versus the prior year and, on a currency-neutral basis, decreased 30 basis points. Benefits from gross productivity savings of 160 basis points and increased pricing of 50 basis points were more than offset by 120 basis points of unfavorable mix, 60 basis points of product reinvestments, and 60 basis points of higher costs from tariffs.

Looking ahead, P&G (PG) now expects net impacts of foreign exchange rates and acquisitions and divestitures to be a tailwind of approximately one percentage point to all-in sales growth. The company also maintained its outlook for organic sales growth in the range of in-line to up 4%. P&G continues to expect adjusted free cash flow productivity of 85% to 90% and expects to pay around $10 billion in dividends and to repurchase approximately $5 billion of common shares in FY26.

“We have confidence in our plans to deliver stronger results in the second half of the fiscal year,” highlighted Moeller.

Shares of Procter & Gamble (PG) fell 1.7% in premarket trading. Church & Dwight (CHD), Clorox (CLX), and Colgate-Palmolive (CL) were all slightly higher as well in the early session. The ETFs with the highest weighting of P&G are the iShares US Consumer Staples ETF (IYK), the Vanguard Consumer Staples Index Fund ETF (VDC), and the Fidelity MSCI Consumer Staples Index ETF (FSTA).

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Wall Street expects the consumer goods giant to post EPS of about $1.86, a 1.1% year‑on‑year decline, on revenue of roughly $22.29 billion, implying a 1.8% rise.

Procter & Gamble heads into its second quarter earnings after a volatile period marked by mixed sales signals and uneven investor sentiment. The company has flagged pressure on U.S. sales due to the temporary suspension of federal food assistance and broader economic headwinds, raising concerns about near-term demand in key household categories. Management has also warned that the government shutdown could exacerbate softness in domestic volumes during the quarter.

Jefferies recently named the company among its favorite household product stocks, citing restructuring tailwinds and innovation-led growth.

According to Seeking Alpha’s Quant rating system, PG is rated Hold, with a score of 3.23 out of 5, with grades of A+ in profitability, B+ in revisions, but offset by weaker grades of C in momentum, a D+ in growth, and a D- in valuation.

An analyst said Procter & Gamble remains a Hold and is still slightly overvalued despite being a high-quality business with a wide economic moat, adding, “In my opinion, Procter & Gamble is slightly overvalued right now, and with other companies in this market that are better valued, I have little reason to choose Procter & Gamble as an investment right now.”

Over the last two years, PG has beaten EPS estimates 100% of the time and has beaten revenue estimates 38% of the time.

In the past three months, EPS estimates have seen no upward revisions and 14 downward moves. Revenue estimates have seen no upward revisions and 11 downward revisions.

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Multiple 2025 patent applications assigned to The Gillette Company LLC cover a “shaving razor system” with very tight dimensional and angular constraints, clearly distinct from legacy Fusion/Mach3/Venus geometries. The patents emphasize ergonomics for underarm and pubic (bikini) region shaving, matching how a new branded system like Lystra would be positioned in Gillette’s portfolio.

Recent IP filings covering both razors and cartridges point to a broader grooming ecosystem rather than a limited line such as GilletteLabs in 2019, according to Evercore ISI. Analyst Robert Ottenstein highlighted that the pace of patents and trademark activity points to a potential commercial launch in the first half of 2026, which is considered potentially good timing for low-income consumers.

“Within shaving, however, superior technology -not just pricing- has driven share. This dynamic is evident when comparing consumer demographics of Gillette’s newest extension, Labs, both Fusion and competitor Harry’s,” updated Ottenstein.

Procter & Gamble (P&G) acquired The Gillette Company in a 2005 merger. Gillette now operates as a P&G brand within the company’s global grooming portfolio, alongside Venus, Braun, and King C. Gillette.

The consumer products giant is lined up to report fiscal second-quarter earnings on January 22.

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Additionally, looking towards next week, industry players such as Caterpillar (CAT) and Pfizer (PFE) will see the ex-dividend dates for their upcoming dividend payments.

See a breakdown below of some of the highlights of this week, along with some upcoming activity on the dividend front.

Dividend Increases

Here are some companies that have announced a dividend increase in the past week:

Taiwan Semiconductor Manufacturing Limited (TSM)

• Dividend declared: January 15
• New dividend amount: $6.00
• Previous amount: $5.00
• Increase: 20%

Goldman Sahchs (GS)

• Dividend declared: January 15
• New dividend amount: $4.50
• Previous amount: $4.00
• Increase: 12.5%

S&P Global (SPGI)

• Dividend declared: January 15
• New dividend amount: $0.97
• Previous amount: $0.96
• Increase: 1%

Dividend Declarations

Here are some companies that have announced a dividend in the past week:

Citigroup (C)

• Dividend declared: January 12
• Dividend amount: $0.60

Procter & Gamble (PG)

• Dividend declared: January 13
• Dividend amount: $1.0568

Costco (COST)

• Dividend declared: January 15
• Dividend amount: $1.30

Texas Instruments (TXN)

• Dividend declared: January 15
• Dividend amount: $1.42

Upcoming Dividend Calendar

Here are some companies that have an ex-dividend date coming next week:

Caterpillar (CAT)

• Ex-dividend date: January 20
• Payout date: February 19

Dell Technologies (DELL)

• Ex-dividend date: January 20
• Payout date: January 30

Colgate-Palmolive (CL)

• Ex-dividend date: January 21
• Payout date: February 13

Pfizer (PFE)

• Ex-dividend date: January 23
• Payout date: March 6

Additional Dividend Information

For investors looking to gain further access to the dividend space, listed below are some popular dividend-focused ETFs that can be further analyzed:

Dividend ETFs: (VIG), (SCHD), (VYM), (DGRO), (SDY), (DVY), (IDV), (DGRW), (NOBL), (HDV), (RDVY), (VIGI), and (SDVY).

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