On Friday, RBC Capital Markets maintained their Sector Perform rating on Procter & Gamble (NYSE:PG) stock, with a consistent price target of $164.00. The firm's commentary highlighted expectations for the company's solid fundamentals to persist, albeit with some potential disruptions due to international headwinds and other factors.
RBC anticipates Procter & Gamble to achieve organic sales growth in the range of 2-3%, which they believe will likely be rounded up to 3%. This forecast is slightly conservative compared to the broader market consensus, especially on the bottom line. The firm's caution stems from anticipated cost impacts related to a recent cyber-attack on a global transportation management provider used by Procter & Gamble.
The growth in organic sales is expected to be primarily driven by performance in the United States, although the pace of growth is showing signs of slowing. RBC also projects mid-single-digit percentage growth in Focus and Enterprise Markets but notes continued pressure in specific regions, including China and the Middle East.
Looking ahead, RBC points to foreign exchange fluctuations and broader international macroeconomic pressures. These factors are likely to keep Procter & Gamble's financial performance towards the lower end of the company's guidance ranges for the remainder of the year. Despite these challenges, the firm's outlook for Procter & Gamble remains steady with the set price target, reflecting an anticipation of resilience in the company's underlying business operations.
In other recent news, Procter & Gamble (P&G) has announced a quarterly dividend of $1.0065 per share, marking the 134th consecutive year of dividend payments and the 68th year of dividend increases.
This development comes alongside several analyst reports. Deutsche Bank (ETR:DBKGn) lowered its stock price target for P&G to $188 due to pressures on the company's fundamentals and a ransomware attack on its main transportation management service provider.
On the other hand, DA Davidson upgraded P&G stock from Neutral to Buy and increased the price target to $209 based on the company's performance and growth expectations. Jefferies maintained a Hold rating and a steady price target of $174, reflecting a cautious outlook due to supply chain disruptions and increased foreign exchange pressure.
In addition, P&G has committed to greater transparency regarding its wood-pulp supplier audits, aiming for more sustainable sourcing practices. The company reported a 2% increase in organic sales for the first quarter, primarily driven by volume growth and pricing strategies. Lastly, P&G plans to return $16-17 billion to shareholders through dividends and share repurchases.
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