Procter & Gamble Company (NYSE:PG) shares rose Thursday after the consumer goods giant posted a modest earnings beat, even as revenue came in slightly below expectations and the company trimmed its longer-term profit outlook.
The company reported second-quarter adjusted earnings of $1.88 per share, topping the Street's $1.86 estimate. Quarterly sales totaled $22.21 billion, falling just short of the $22.28 billion consensus forecast.
P&G also lowered its fiscal 2026 GAAP earnings guidance, cutting its EPS outlook to a range of $6.58 to $6.90 from a prior $6.71 to $7.09. The revised range sits below the $6.91 consensus estimate and weighed on the otherwise solid quarter.
Still, Bank of America Securities analyst Peter Galbo reiterated a Buy rating on the stock with a $170 price target, pointing to margin strength as the primary driver of the earnings upside. Organic sales were in line with both company expectations and consensus, he added.
Meanwhile, stronger gross margins and favorable interest and tax impacts lifted adjusted earnings above his model.
Galbo noted that P&G reiterated its full-year organic sales and adjusted earnings outlook, implying acceleration in the second half of the fiscal year. Some investors had been expecting tighter guidance following first-half trends, a dynamic that could shape near-term trading, though Galbo expects the market reaction to remain muted after what he described as a largely in-line quarter.
Management maintained its fiscal-year outlook, projecting organic sales growth ranging from flat to modest gains. Updated assumptions show commodity costs turning neutral and foreign exchange remaining a tailwind.
Tariff, interest, and tax headwinds remain unchanged. Capital spending and cash flow targets were also left intact.
By segment, results largely matched expectations. Strength in Health Care helped offset weaker performance in Grooming. Skin Care exceeded forecasts on premium mix and pricing strength, particularly in Greater China.
Investors will be listening closely to the earnings call for commentary on U.S. consumer demand and broader category momentum.
PG Price Action: Procter & Gamble shares are trading higher by 3.78% to $149.39 at last check Friday.
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