Procter & Gamble Earnings: Brand Reinvestments Buoy Sales Growth and Margins; Shares Not Attractive

Even amid a challenging macroeconomic backdrop, we surmise wide-moat Procter & Gamble chalked up solid second-quarter marks, including 4% organic sales growth, 520 basis points of gross margin expansion to 52.7%, and 400 basis points of adjusted operating margin gains to 27%. The U.S. (about half its total sales base) and Europe focus markets (we estimate 15%-20% of sales) were particular standouts, recording 5% and 7% organic sales growth, respectively, on 4% and 3% volume gains.