Analyst Note| Erin Lash, CFA |
Third-quarter results once again reflect the prudence of wide-moat Procter & Gamble’s decision eight years ago to tilt its portfolio more toward daily use, essential categories. Organic sales shot up 10%, on top of a 4% gain last year. And despite a stout 5% contribution from higher prices, volumes held up quite well, benefiting sales to the tune of 3% (with favorable mix also aiding sales by 2%). Even as consumers have been digesting higher prices at the shelf seamlessly thus far, we’re cognizant the combination of skyrocketing prices throughout the grocery store, rising gas prices, and mounting interest rates (among other factors) could ultimately prompt trade down to lower-priced alternatives.