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Procter & Gamble Places Low Bets on the Table for Fourth Quarter


P&G has lowered its quarterly earnings guidance along with revenue forecasts.


Procter & Gamble (PG) has followed up a difficult third quarter with some more disappointing news: The world's largest household product maker has lowered its quarterly earnings guidance along with revenue forecasts as the company has seen lackluster market share growth as of late.

The company's April-June 2012 quarter resulted in lower than expected organic sales growth, which is anticipated to be in the range of two to three percent now rather than the originally anticipated four to five percent span.

With analyst and investor concerns growing, Procter & Gamble CEO Bob McDonald attempted to calm the storm this yesterday at the Deutsche Bank Global Consumer conference.

"We are making the necessary adjustments to our growth strategy to increase focus on our core business and to achieve more balanced growth across geographies, product categories and the top and bottom lines," McDonald said.

Procter & Gamble will strive to increase aggregate market share by the end of fiscal 2013, and will provide updates for the full year guidance when 2012's results are released in August.

According to Deutsche Bank, the company understands what it is up against and how to combat market share losses.

Deutsche Bank believes that while the guidance for both the upcoming quarter and 2013 did not exactly spark an operational reset, it is still safe to maintain its Buy rating, $70 price target and faith in the company.

However, if the company does not step up their performance against opposing businesses, there is no telling how much longer fans will stick by its side.

Yahoo said Procter & Gamble has been underperforming rivals like Unilever (UL) and Colgate-Palmolive (CL), which eventually prompted its big restructuring plan to cut 5,700 non-manufacturing jobs and $10 billion of costs by the end of 2015/2016.

Unfortunately, tough markets in Europe, the US, and now China are continuing to weigh heavy on not only the household product industry, but countless others in general. With no quick fix in the works, it appears that Procter & Gamble's cost-cutting plan (announced earlier this year) will continue to be a large focus for the popular brand.

Procter & Gamble is currently trading around $60, down about 10% year-to-date.

Editor's Note: This content was originally published on by Katey Stapleton.

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