Consumer staple giant Procter & Gamble saw its stock move 2% higher though investors should be cautious about buying the stock.
Shares of P&G stock have been struggling over the last three months as investors have shifted their portfolios to more speculative, “risk on” investments.
In August 2024, P&G shares were attracting a larger group of buyers as investors were preparing for an increase in volatility. The company’s stock has long been known as a “safe harbor” stock based on their stability in changing economies.
That sentiment towards the market has shifted as investors are now taking a “risk on” approach, favoring speculative investments over safe.
Procter and Gamble’s earnings per share were $0.02 better than expected as the company’s revenue also beat analysts’ target. Revenue for the company grew 2.1% compared to last year’s numbers.
The earnings result expressed continued strength in the consumer as P&G saw sales volumes increase heavily across their product lines.
While strength in consumer activity is good, investors are more interested in harnessing higher returns from more speculative investments right now.
Companies like Oracle (ORCL), Microsoft (MSFT) as well as riskier investments in quantum computing and AI are crowding out the interest in slower moving stocks like Procter and Gamble. Consumer staples companies like P&G are only trading about 10% higher over the last year.
Procter and Gamble’s price chart shows the lack of excitement as the stock is currently under pressure from a bearish trend.
Two weeks ago, P&G stock fell below its 200-day moving average. The break of this critical trendline acts as a technical warning to investors that shares are likely to continue lower.
In addition, P&G’s 50-day moving average recently shifted into a bear market trend. That shift forecasts lower prices over the next 4-6 weeks.
From a longer-term perspective, the stock remains above its 20-month moving average. That trendline notably marked the stock’s recent January lows. A return to this price suggests that P&G stock is shifting into a long-term bear market trend.
Shares of Procter & Gamble are currently in a neutral trend with a price target of $150.