UBS Reiterates Buy Rating on Procter & Gamble (PG) on Attractive Valuation

UBS analyst Peter Grom reiterated a Buy rating and $166.00 price target on Procter & Gamble (NYSE: PG).

The analyst commented, "P&G is scheduled to report F3Q26 EPS next Friday (4/24) before the open; we forecast 3Q EPS of $1.56, in-line with both Visible Alpha/FactSet consensus. As outlined in our preview, we think the quarter itself will not offer any major surprises and believe that organic sales growth will show sequential progress (see more below). As it relates to FY26 guidance, we believe incremental cost pressures coupled with unfavorable moves in FX could result in the company highlighting the lower half is more likely on the bottom line, but think this is largely expected. In our view, the bigger question centers on earnings power over the next 12-18 months and while we do not expect management to provide an official view on FY27 at this stage, we suspect it will be a key point of focus, particularly around what cost pressures look like based on where things stand today. Although we see modest downside to Street numbers looking out to FY27 (our $7.09 forecast is ~2% below consensus), we think this is a dynamic that will be felt across much of the group and as such we have been surprised by the relative underperformance of P&G of late, especially with top line showing some modest progress. We do not believe the print will be a positive catalyst in isolation, but with shares underperforming the XLP by nearly 5% to start the year and valuation screening as attractive, we think the risk/reward continues to skew to the upside."

For an analyst ratings summary and ratings history on Procter & Gamble click here. For more ratings news on Procter & Gamble click here.

Shares of Procter & Gamble closed at $143.11 yesterday.

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