The Procter & Gamble Company (PG), Colgate-Palmolive Company (CL), Unilever plc (ADR) (UL): Will a CEO Transition Help This Company to Regain Its Lost Ground?

Peer Analysis

Colgate-Palmolive Company (NYSE:CL), one of Procter and Gamble’s primary competitors, enjoyed good growth in Latin America despite the currency devaluation in Venezuela and inflation throughout the region. The company reported results for the first quarter of 2013 with earnings per share of $1.32, in line with the consensus estimate. Organic sales increased by 6% year-over-year against the consensus estimate of 5%.

The company is focusing on product innovation in different categories in both developed and emerging markets. Four new products will be launched under the whitening category, the “Colgate Max Fresh” brand, the “Elmex” brand and the electric toothbrush category. The company has relaunched its “Colgate Total” brand in Brazil and Mexico and is expected to launch it in other countries over a one-year period. The company has also relaunched its “Science Diet” and “Ideal Balance” pet food brands.

Another competitor, Unilever plc (ADR) (NYSE:UL), is planning to get a strong foothold in emerging markets. It has offered to extend its stake in its Indian subsidiary, and has also increased its sales and distribution reach in Indonesia. Such initiatives will help the company to achieve long-term growth.

Unilever plc (ADR) (NYSE:UL)’s new product launches across many categories and markets will help it to attract customers. Likewise, its “sustainable living plan” will help it to retain these customers as well as improve the efficiency of its business. I believe that the company is a good buy at these levels.

Conclusion

Procter and Gamble’s cost cutting program will help the company to gain share in a competitive market. It will help the company to get a foothold in the emerging as well as the developed markets. Investors have great expectations from its new CEO. If all the three strategies work well then Procter & Gamble will be able to win the race but it will take some time. As of now, I recommend a wait and watch approach for the stock.

The article Will a CEO Transition Help This Company to Regain Its Lost Ground? originally appeared on Fool.com and is written by Gayatri Sharma.

Gayatri Sharma has no position in any stocks mentioned. The Motley Fool recommends Procter & Gamble and Unilever. Gayatri is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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