We’re buying 40 shares of Procter & Gamble (PG) at roughly $142.50 each. Following Friday’s trade, Jim Cramer’s Charitable Trust will own 840 shares of P & G, increasing its weighting in the portfolio to 4.24% from 4.05% Procter & Gamble reported slightly softer than expected fiscal fourth quarter earnings Friday morning. Revenue in the quarter increased 3% year over year to $19.5 billion, exceeding estimates of $19.4 billion. Organic growth was up 7%, thanks to an 8% increase in price and a 1% decline in volume, which was mostly due to transitory factors related to the lockdowns in China and reduced operations in Russia. However, increased costs weighed on the bottom line and could not be fully offset by pricing actions, leading to earnings per share of $1.21, which was a small miss compared to estimates of $1.23. The company also provided guidance for its fiscal 2023. The company expects total sales growth to be in the range of flat to up 2% versus last year, with a foreign exchange headwind (FX) of about 3%. Organic sales growth is expected to be solid, up in the range of 3% to 5%. But on earnings, P & G is forecasting a $3.3 billion after-tax hit, or $1.33 per share, headwind from unfavorable FX, higher commodity costs, and freight costs. Due to these factors, P & G expects net earnings per share growth, in the range of in -line to up 4%. This midpoint of this view is $5.93, which is below the consensus estimate of $6.02. The stock was looking down premarket as the market saw this releases as a quarterly miss and guide lower. But we argue the quarter was telegraphed well in advance by management. Recall, at a conference in mid-June, they walked down expectations. Due to the well-known currency and commodity challenges the company is experiencing, we believe the full-year guidance was the cut investors had been waiting for. Also, imagine the EPS lift Procter will see once the dollar starts to weaken and the commodity pressures subside, but P & G maintains price. We’ll have more analysis about the quarter later in the day. But with the stock down around 3.5% in premarket trading on a 1.5% guidance miss that probably has some conservatism to it, we believe the weakness in shares represents a buying opportunity. That’s why we’re adding to our position. Although we are putting some cash to work Friday morning, we expect to make some sales later in eh day, because the recent run in the market has pushed the S & P Oscillator deeply into overbought territory. After Thursday’s broader market rally, the Oscillator reading came in at positive 8.31%. As a reminder, anything above positive 4% means the market is technically said to be overbought and due for a pullback. (Jim Cramer’s Charitable Trust is long PG. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
