P&G (PG) Buys Walker & Company, Enhances Beauty Portfolio

Procter & Gamble Company (NYSE:PG) , commonly known as P&G, has taken aboard a startup company — Walker & Company Brands — which deals in providing health and beauty solutions. Founded in 2013, Walker & Company brings with it customized products and services, which includes Bevel — a grooming line for men with coarse and curly hair, and Form — a hair care line for women with textured hair. Details about the transaction value remained under covers.

As a merged entity, Walker & Company will operate as a separate and wholly-owned subsidiary of P&G, under the able leadership of its CEO and founder, Tristan Walker. The company will move its headquarters from Palo Alto to Atlanta with Walker and his 15 employees.

This buyout is likely to be mutually beneficial. P&G, in particular, will benefit from Walker & Company’s profound consumer understanding, authentic bond with customers and its exclusive and tailored products. Meanwhile, Walker & Company is likely to gain from P&G’s global scale, skilled workforce, resources and technical soundness.

With this merger, the companies plan to bolster P&G’s multicultural business and speed up growth of Walker & Company’s existing brands. Further, as a combined company, they plan to develop additional products intended to meet the precise requirements of people.

P&G's shares did not react much to the news. However, this Zacks Rank #3 (Hold) stock gained 12.4% in the last three months, outperforming the industry’s 5.1% growth.

P&G relies on its strategy of acquiring complementary businesses to enhance its product portfolio. In this month, P&G completed the acquisition of the consumer-health business of Germany-based Merck KGaA. Agreed upon in April 2018, the acquisition is likely to bolster P&G’s over-the-counter (OTC) geographic footprint as Merck KGaA’s consumer health business is active in 44 countries and includes more than 900 products.

Additionally, P&G acquired beauty brand First Aid Beauty for $250 million in July 2018, which should help regain its position in the beauty space that it lost after selling its 43 beauty brands to Coty Inc. (NYSE:COTY) in 2016.

Looking for Better-Ranked Consumer Staples Stocks? Check These

Church & Dwight Co., Inc. (NYSE:CHD) has average long-term EPS growth rate of 10.1% and a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Estee Lauder Companies Inc. (NYSE:EL) , also a Zacks Rank #2 stock, is expected to witness average long-term EPS growth rate of 11.9%.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>