I wrote two days ago about the growing list of prominent consumer companies that have cut their full-year sales guidance in the last three months on account of weakness in consumer spending. If this morning is any indication, the list is about to get considerably longer in the days and weeks ahead. Sherwin-Williams, Kimberly-Clark and Genuine Parts all cut their sales guidance, with Kimberly’s organic sales growth having slowed from 6% in 1Q to just 1% in 3Q. Of the four major consumer packaged goods (CPG) companies to have reported their 3Q results thus far, three have cut sales guidance: PepsiCo, Nestle and Kimberly-Clark. Procter & Gamble maintained its organic sales guidance, but has nonetheless experienced a notable slowdown in its growth rate in recent quarters (see below). This is happening in an above-trend GDP growth economy; what will happen to these companies’ sales trends in an economic slowdown?
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