Video Reports

Embed this video

Copy Code

Link to this video

Get LinkEmbedLicenseRecommend (-)Print
Bookmark and Share

By Jason Stipp and Jeremy Glaser | 04-24-2015 09:00 AM

Friday Five: Two Big Turnarounds on Track

Bright spots in P&G and Coke earnings show their situations are stabilizing. Plus, Facebook gets a fair value hike, Chipotle shares get more appetizing, and more.

Jason Stipp: I'm Jason Stipp for Morningstar, and welcome to The Friday Five, Morningstar's take on five stories in the market this week. Joining me with The Friday Five is Morningstar markets editor Jeremy Glaser.

Jeremy, thanks for being here.

Jeremy Glaser: You're welcome, Jason.

Stipp: It was a big earnings week. Let's start with P&G. They reported results, and there are some signs that they are starting to get traction with their turnaround, and the shares also might be worth a look.

Glaser: We can see signs that P&G's competitive position is stabilizing. The top line is still weak. It had about 1% growth, and that excludes all the foreign-currency headwinds; when you add those in, they had a pretty big decline in sales. There were some weak spots, particularly in beauty.

But there were also some spots that looked a bit better--things like laundry detergent in the U.S. and diapers--that were showing signs of gaining share. Erin Lash, our P&G analyst, thinks that's a good sign, that when Procter & Gamble is able to put a focused marketing push behind products, they still are able to gain share. That's heartening for the future, as they focus on their core brands.

There are also signs that their cost-cutting measures really are starting to bear fruit as well, and that showed up in the profitability numbers.

As you mentioned, Procter & Gamble shares look relatively attractive. In a sector that does not have many values, Procter & Gamble is the wide-moat firm that looks the most interesting for investors. It's certainly worth a closer look.

Stipp: Coke also reported this week. They have warned and asked for patience as they are in the midst of a transition, but they turned in pretty decent results.

Read Full Transcript

{0}-{1} of {2} Comments
{0}-{1} of {2} Comment
  • This post has been reported.
  • Comment removed for violation of Terms of Use ({0})
    Please create a username to comment on this article