We’re buying 30 shares of Procter & Gamble at roughly $156.41. Following Wednesday’s trade, Jim Cramer’s Charitable Trust will own 520 shares of PG, increasing its weighting to 2.52% from 2.38%. Shares of Procter & Gamble were off more than 2% on Wednesday after Ulta ‘s downbeat comments about the beauty market at the JPMorgan Retail Round Up conference. The beauty product retailer warned of a slowdown in the total beauty category across different price points and segments. This new outlook comes after several years of strong category growth, leading Ulta to guide first quarter comparable sales toward the lower end of guidance. Ulta explained some of the category softness was blamed on a mixed economic picture and “societal factors” about the state of the consumer. In addition, management acknowledged increased competitive pressure from Sephora, which has a big partnership with Kohl’s . The update caused Ulta shares to fall more than 14%, and the selling spread to other companies in the space like ELF Beauty , Club name Estee Lauder , Coty , and even Procter & Gamble. PG 1Y mountain Procter & Gamble YTD You may wonder why a household staple like P & G is getting caught up in this mix. Its Beauty segment is expected to make up about 23% of the company’s pre-tax income in fiscal year 2024 — and historically, it has been a strong source of growth. However, organic sales increased by only 1% last quarter after a temporary boycott in China of a Japanese skincare brand SK-II (owned by P & G) weighed down sales. Despite the beauty softness last quarter, Procter shares surged after earnings on the improving volume trends and ongoing improvement to profit margins. We don’t think a quality stock like Procter & Gamble that sells a whole bunch of consumer products outside the beauty category should be down this much on Ulta’s woes. We question how much of the softness Ulta is seeing is due to increased points of competition versus a big change to the industry. We’re…
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