PreMarket Prep Stock Of The Day: Procter & Gamble

Benzinga's PreMarket Prep airs every morning from 8-9 a.m. ET. During that fast-paced, highly informative hour, traders and investors tune in to get the major news of the day, the catalysts behind those moves and the corresponding price action for the upcoming session.

On any given day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick along with producer Spencer Israel.

The price action in Proctor & Gamble PG following its second-quarter report makes it the PreMarket Prep Stock of the Day.

Procter & Gamble Price Action Ahead Of Earnings: Proctor & Gamble decoupled itself from the broad market when it made its all-time high on Nov. 9 at $146.62. It posted its all-time closing high a few days later at$144.28.

While the S&P 500 index has continued to make new highs, the issue has been under selling pressure.

Shorter-term investors were leaning the right way into the company’s second-quarter report. It had traded lower in seven of  eight trading sessions since it peaked Jan. 6 at $141.04 and ended that session at $140.16. The one outlier was a small 21-cent gain Jan. 13. 

Over that course of time, Procter & Gamble declined from $140.16 to $133.60 on Tuesday.

P&G's Q2 Beat, Premarket Price Action: Before the open Wednesday, the company announced second-quarter core EPS of $1.64 vs. a $1.51 estimate along with a sales beat, $19.70 billion vs. a $19.27-billion estimate.

Procter & Gamble raised its FY21 core EPS growth guidance from 5%-8% To 8%-10%.

As expected, the algorithms read all the good in the report and the issue embarked on a solid rally.

By 8:15 a.m. the issue was nearly $4 higher when it peaked at $137.59 and reversed course. That high coincided with its Jan. 14 high of $137.65.

Dennis Dick's Procter & Gamble Trade: In this market environment, when so many other issues are making enormous percentage gains on a daily basis, why be invested in a stodgy stock with a small dividend when fortunes can be made in so many other issues?

PreMarket Prep co-host Dennis Dick, who shorted and covered the issue in the premarket session Wednesday, elaborated on this concept during the show. 

The full discussion on the issue from Wednesday’s show can be found here.

Procter & Gamble's Price Action Wednesday: Procter & Gamble's share price continued to deteriorate during the remainder of the premarket session.

In fact, it opened over $1 lower at $132.53. It continued lower and bottomed at $131.26 before mounting a rally.

That marked the lowest level for this issue since Aug. 4, when it bottomed at $130.70, with the previous day’s low just under that level at $130.47.

As of 11:45 a.m. ET, it found resistance just above Tuesday’s closing price ($133.60) at $133.870 and resumed its move lower.