Procter & Gamble (NYSE:PG) Shares Climb 1.4% - Here's Why

Key Points

• Procter & Gamble shares rose 1.4% to about $160.48 after the company exceeded quarterly earnings and revenue expectations, with revenue up 4% year over year.
• Analyst sentiment is generally positive: the stock has a consensus “Moderate Buy” rating and an average price target of $170.57, though DZ Bank downgraded it to “Hold” amid valuation concerns.
• Investors continue to receive a quarterly dividend of $1.0885 per share, a 2.7% annualized yield, while rising costs and recent insider selling remain potential risks.

Procter & Gamble Company (The) (NYSE:PG - Get Free Report)'s stock price shot up 1.4% during mid-day trading on Thursday. The stock traded as high as $160.95 and last traded at $160.4760. Approximately 7,477,801 shares traded hands during mid-day trading, a decline of 23% from the average daily volume of 9,720,972 shares. The stock had previously closed at $158.26.

Procter & Gamble News Summary

Here are the key news stories impacting Procter & Gamble this week:

• Positive Sentiment: Broker upgrade supports sentiment: Freedom Broker upgraded PG from “hold” to “buy,” adding to the bullish case for the consumer-staples company. Freedom Broker upgrades Procter & Gamble to buy from hold
• Positive Sentiment: Quarterly performance remains solid: P&G recently exceeded earnings and revenue expectations, with revenue increasing year over year. Organic sales growth was driven largely by higher product volumes, suggesting demand is holding up despite a challenging consumer environment. Procter & Gamble is accelerating revenue growth as its costs are rising
• Positive Sentiment: Some analysts see upside: Coverage following the latest quarter argues that P&G may be undervalued, with the earnings beat lifting expectations and reinforcing the company’s defensive growth and dividend appeal. Procter & Gamble stock may be undervalued
• Neutral Sentiment: Bond issuance highlights financial flexibility: P&G sold multiyear fixed-rate notes in euro and dollar markets. The proceeds provide funding flexibility, but the issuance also puts attention on borrowing costs, leverage and the company’s relatively expensive valuation. Procter & Gamble bond sale puts valuation in focus
• Negative Sentiment: Analyst caution remains: DZ Bank downgraded PG from “strong-buy” to “hold,” reflecting potential concerns about the stock’s valuation after its recent gains. ETF investors were also net sellers on October 23, indicating some short-term institutional profit-taking. DZ Bank recommendations
• Negative Sentiment: Costs could pressure margins: Rising commodity and operating costs remain a risk, potentially limiting the benefit of accelerating revenue unless P&G can offset inflation through pricing, productivity gains and favorable product mix. How Procter & Gamble is handling commodity costs

Analysts Set New Price Targets

A number of equities research analysts recently issued reports on PG shares. BNP Paribas Exane upped their price target on shares of Procter & Gamble from $177.00 to $189.00 and gave the company an "outperform" rating in a research note on Friday, October 23rd. Evercore raised shares of Procter & Gamble from an "in-line" rating to an "outperform" rating and set a $166.00 price target for the company in a report on Tuesday, October 6th. Citigroup lifted their target price on Procter & Gamble from $180.00 to $187.00 and gave the stock a "buy" rating in a report on Friday, October 23rd. DZ Bank lowered shares of Procter & Gamble from a "strong-buy" rating to a "hold" rating in a report on Tuesday. Finally, Deutsche Bank Aktiengesellschaft reissued a "buy" rating on shares of Procter & Gamble in a research note on Friday, October 23rd. Fifteen analysts have rated the stock with a Buy rating and eleven have given a Hold rating to the company. Based on data from MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and an average target price of $170.57.

Procter & Gamble Stock Up 1.4%

The business has a 50-day moving average price of $149.30 and a 200-day moving average price of $148.76. The stock has a market cap of $371.95 billion, a PE ratio of 24.17, a price-to-earnings-growth ratio of 4.00 and a beta of 0.39. The company has a current ratio of 0.72, a quick ratio of 0.53 and a debt-to-equity ratio of 0.40.

Procter & Gamble (NYSE:PG - Get Free Report) last announced its quarterly earnings results on Thursday, October 22nd. The company reported $2.00 earnings per share for the quarter, beating analysts' consensus estimates of $1.89 by $0.11. The business had revenue of $23.28 billion during the quarter, compared to analysts' expectations of $22.80 billion. Procter & Gamble had a net margin of 18.23% and a return on equity of 31.02%. The business's revenue for the quarter was up 4.0% on a year-over-year basis. During the same period last year, the business earned $1.99 earnings per share. As a group, analysts forecast that Procter & Gamble Company will post 6.98 earnings per share for the current year.

Procter & Gamble Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Monday, November 16th. Stockholders of record on Friday, October 23rd will be given a dividend of $1.0885 per share. This represents a $4.35 dividend on an annualized basis and a dividend yield of 2.7%. The ex-dividend date of this dividend is Friday, October 23rd. Procter & Gamble's payout ratio is presently 65.51%.

Insiders Place Their Bets

In related news, CEO Paul Gama sold 4,331 shares of the stock in a transaction dated Friday, October 23rd. The shares were sold at an average price of $161.27, for a total value of $698,460.37. Following the completion of the transaction, the chief executive officer owned 46,793 shares in the company, valued at $7,546,307.11. This represents a 8.47% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at this hyperlink. Also, CEO Shailesh Jejurikar sold 35,000 shares of the firm's stock in a transaction dated Friday, October 23rd. The shares were sold at an average price of $163.09, for a total transaction of $5,708,150.00. Following the transaction, the chief executive officer directly owned 55,391 shares in the company, valued at approximately $9,033,718.19. The trade was a 38.72% decrease in their position. The SEC filing for this sale provides additional information. Over the last ninety days, insiders have sold 58,647 shares of company stock valued at $9,268,508. Corporate insiders own 0.23% of the company's stock.

Hedge Funds Weigh In On Procter & Gamble

A number of large investors have recently added to or reduced their stakes in the company. Mowery & Schoenfeld Wealth Management LLC bought a new stake in Procter & Gamble in the second quarter valued at $26,000. Montgomery Financial Services LLC acquired a new stake in shares of Procter & Gamble in the 2nd quarter worth about $28,000. Paladin Partners LLC acquired a new stake in shares of Procter & Gamble in the 2nd quarter worth about $29,000. Evergreen Advisors LLC bought a new stake in Procter & Gamble in the 1st quarter valued at about $37,000. Finally, Toews Corp ADV bought a new stake in Procter & Gamble in the 2nd quarter valued at about $37,000. Institutional investors own 65.77% of the company's stock.

About Procter & Gamble

Procter & Gamble Company NYSE: PG is a global consumer products company that develops, manufactures and markets branded products used in households and personal care. Its portfolio includes personal health and grooming products, beauty and skin care items, baby, feminine and family care products, fabric and home care products, and oral care products.

The company's well-known brands include Pampers, Tide, Gillette, Crest, Oral-B, Head & Shoulders, Pantene, Olay, Old Spice, Dawn, Febreze and Mr.

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