Earnings preview: Procter & Gamble should be fine

The company that brings you Ivory Soap, Procter & Gamble (NYSE: PG), is set to divulge its Q4 numbers on Tuesday. So, what should shareholders expect from this consumer-products behemoth?

Well, I don't think it's going to be much of a surprise. Data at Earnings.com suggest that analysts believe P&G will do $0.78 per share in terms of the bottom line. Management actually expects around that number, as well. A recent piece I wrote about P&G reiterating its guidance shows that between $0.76 and $.78 per share is the range being looked at. So, I think we'll see the top end of the range reported tomorrow. P&G has a solid recent history of slightly beating expectations. Perhaps there will be a beat, but it most likely won't be by more than a penny.

This will represent pretty decent performance in a market wracked by horrible inflationary pressures. Going back to Earnings.com, the previous year's bottom-line number was $0.67 per share, so P&G will be looking at good double-digit growth. The top line, by the way, should expand at least 8%. Volume data will also be important to look at so investors can get a handle on how successfully the company is cultivating price increases. P&G has a significant advantage over competitors since its line of products is so well-known and trusted. I mean, when it comes to things like Ivory Soap, many consumers will refuse to alter their brand loyalties even if they have to pay more at the pump. Yes, sales of generic products obviously do have a challenging impact, but as I found with Kraft's (NYSE: KFT) recent earnings report, brand equity is a selective advantage in the Darwinian landscape of supermarket shelves. It's also useful for protecting margins.