Unilever Trading Update – What Can Investors Expect

Unilever (LSE: ULVR) are set to report its fourth quarter and full year results on Thursday, and after a lacklustre few years for its share price, what should investors expect?

The consumer goods giant reported in its Q3 results that it anticipates full year sales growth to be above 8% following a 10.6% rise in sales for Q3, which was largely boosted by double-digit price increases. However, the group stated that they anticipate weaker underlying volume growth than the first nine months.

The business which owns Ben & Jerry’s, Dove, Lynx and several other big name brands will hope its price increases offset any potential volume declines following a year of soaring inflation and cash-strapped consumers.

As a result, investors will also be keeping a close watch on profit margins, with a challenging economic environment continuing to impact costly branded items. However, evident from its recent results, its brands have commanded loyalty. Major price increases have led to limited volume declines, with just a 1.6% fall in Q3.

Chief Executive Alan Jope stated that “the global macroeconomic outlook remains mixed” and expects the “challenges of high inflation to persist in 2023.”

Unilever was recently reduced at Bernstein, with analyst Bruno Monteyne downgrading the firm to Underperform from Market perform. Monteyne kept a price target of 3,500p but cited three macro worries, namely rotation out of staples, consumers trading down, and deflationary worries as commodities continue to decline.

Elsewhere, Unilever appointed Hein Schumacher as its new CEO, replacing Alan Jope in July following his retirement. The market will likely be watching for any hints on changes to the business moving forward, but also preparing for its guidance to measure how the business will fare.

Source: Unilever TradingView Chart

Unilever shares have gained almost 10% over the last year.

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