Street View: Procter & Gamble capable of dealing with complex trade environment

Pampers maker Procter & Gamble PG.N said on Thursday it would raise prices on some products to cover the impact on input costs from the trade war and lowered its annual forecasts, as consumers cut back spending due to economic uncertainty.

CAPABLE TO DEAL WITH THE COMPLEX ENVIRONMENT

Citigroup ("buy", PT: $181) suspects PG is now past retail destocking headwinds in the U.S. and co continues to make sequential progress on China organic sales growth, and the tariff guide is likely a worst-case scenario

However, brokerage acknowledges the risk to FY26 EPS delivery from lingering category softness and PG's reinvestment bias, esp if the 145% China tariffs remain intact

BofA Global Research ("buy", PO: $180) says key takeaway from PG's Q3 results is the underlying business continues to perform well despite tariff impacts

Believes market is pricing in a worst-case scenario on tariffs, which PG anticipates is possible to mitigate through favorable FX, declining commodity costs, and pricing/innovation

RBC Capital Markets ("outperform", PT: $177) believes PG has the right management team and capabilities (innovation, supply chain flexibility, RGM) to deal with the complexity and dynamic nature of the environment

TD Cowen ("buy", PT: $175) says it found it encouraging to hear that despite the weaker environment, management remains committed to growing their categories by investing behind their brands with strong innovation and appropriate media support