Goldman Sachs analyst Bonnie Herzog has maintained their neutral stance on PG stock, giving a Hold rating on April 17.
Bonnie Herzog has given his Hold rating due to a combination of factors including Procter & Gamble’s recent financial performance and market expectations. In the latest quarter, Procter & Gamble exceeded earnings per share predictions, but their organic growth was slightly below analyst expectations, suggesting a mixed financial picture. While the company saw increased gross margins, this was balanced by higher selling, general and administrative expenses, resulting in consistent operating margins. Additionally, favorable external factors such as a lower tax rate and other income contributed positively to earnings, but these are not necessarily indicative of operational strength.
Moreover, Herzog remains cautious due to the ambitious growth implied by the company’s forecasts for the upcoming quarter, which might be challenging to achieve given the modest deceleration observed throughout the year. While the company’s fundamentals are solid and they have raised their full-year earnings outlook, these positives seem to be already factored into the current stock valuation. Given that the stock’s valuation is in line with its five-year average, Herzog suggests that the market has already recognized Procter & Gamble’s robust fundamentals, leaving little room for upside surprise and thus warranting a neutral position.
According to TipRanks, Herzog is a 4-star analyst with an average return of 2.7% and a 54.72% success rate. Herzog covers the Consumer Defensive sector, focusing on stocks such as Philip Morris, Molson Coors, and Altria Group.
In another report released on April 17, RBC Capital also maintained a Hold rating on the stock with a $157.00 price target.
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Procter & Gamble (PG) Company Description:
Procter & Gamble Co. manufactures and sells branded consumer packaged goods across five segments: Beauty; Grooming; Health Care; Fabric & Home Care; and Baby, Feminine & Family Care. Some of the popular brands owned by the company include Head & Shoulders, Pantene, Olay, Gillette, Oral-B, Vicks, Ariel, Tide, Pampers, Luvs and Bounty. The company was founded by William Procter and James Gamble in 1837 and is headquartered in Cincinnati, OH.
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