Procter & Gamble Downgraded Ahead of Q4 Earnings, Analysts Predict 1-3% Organic Sales Growth

Procter & Gamble was downgraded by Evercore to In Line ahead of Q4 earnings. Analysts predict 1-3% organic sales growth for FY26. The average price target suggests an 11.66% upside from the current stock price. The consensus rating is 2.2, falling under the "Outperform" category. The GF Value is projected at $166.48, indicating a 7.34% potential upside from the current price.

Procter & Gamble (PG) has been downgraded by Evercore ISI from "Outperform" to "In Line" ahead of the company's fourth-quarter earnings report. The downgrade comes with a prediction of 1% to 3% organic sales growth for fiscal year 2026, which is below the market's expected 2.4% growth [1]. This conservative outlook is attributed to macroeconomic pressures, portfolio optimization efforts, and the company's expanded product range now competing in mid-tier, price-sensitive categories [2].

Analysts at Evercore ISI have cited several factors contributing to the downgrade. One significant challenge is the shift towards Amazon, which now accounts for 50% of growth in the U.S. household and personal care market, leading to a significant growth gap with Procter & Gamble's core retailers like Walmart and Costco [3]. Additionally, the company's complex product portfolio and limited presence in high-growth online segments have made it harder to compete with smaller, nimbler brands in the digital marketplace [4].

The average one-year price target for Procter & Gamble, as suggested by 23 Wall Street analysts, is set at $173.18, indicating a potential upside of 11.66% from the current stock price of $155.10 [3]. The consensus among 27 brokerage firms provides an average rating of 2.2, which falls under the "Outperform" category [3]. GuruFocus estimates the GF Value for Procter & Gamble at $166.48, projecting a 7.34% potential upside from the current price [5].

Investors should closely monitor Procter & Gamble's upcoming earnings report and guidance for the new fiscal year. The company's performance and outlook will be crucial in determining whether the downgrade by Evercore ISI is justified. If Procter & Gamble's guidance falls short of expectations, it could further impact investor sentiment and the company's stock price. Conversely, a more optimistic outlook could help stabilize or even improve its stock performance.

References:
[1] https://www.gurufocus.com/news/2976655/evercore-isi-downgrades-procter-gamble-pg-ahead-of-q4-earnings
[2] https://www.ainvest.com/news/evercore-isi-downgrades-procter-gamble-market-perform-cuts-price-target-170-2507/
[3] https://www.gurufocus.com/news/2988933/procter--gamble-pg-downgraded-ahead-of-q4-earnings
[4] https://www.ainvest.com/news/procter-gamble-downgraded-evercore-isi-earnings-report-2507/
[5] https://www.gurufocus.com/news/2988933/procter--gamble-pg-downgraded-ahead-of-q4-earnings