Erste Group lowered its rating on Procter & Gamble (NYSE:PG) to Hold from Buy on Tuesday after taking stock of the setup for the second half of the year.
Analyst Stephan Lingnau noted P&G is one of many companies passing on higher input costs to customers, witnessed by organic sales rising 5% despite the consumer products giant selling fewer items. A potential concern in the near-term is that P&G expects many customers to use up inventory before restocking.
Looking ahead, Lingnau believes that the strength of innovation, and the continuous improvements in productivity should help P&G to overcome the cost related challenges in the current environment. In addition, the high market shares worldwide should, after the increases in recent years, continue to be at least maintained. However, not enough share price catalysts were in place to keep the firm bullish on the stock.
Shares of Procter & Gamble (PG) fell 1.45% to $143.83 in early afternoon trading. The 52-week high on the stock is $158.11.