Procter & Gamble Company (NYSE:PG) shares are trading slightly lower on Thursday, while the firm is gearing up to announce its first-quarter earnings on Friday, October 24.
RBC Capital Markets analyst Nik Modi reiterated an Outperform rating on the stock, with a price forecast of $177.
Outlook And Near-Term Setup
Modi forecasts organic sales growth to be 1.4%, which is rounded to 1% under P&G’s whole-number reporting. He said that figure matches the buy-side bar.
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The analyst projected a slightly lower bottom line, citing prudence, yet expects P&G to meet consensus. He noted tone improved mid-quarter, but growth has stayed slow since.
In fact, early October data materially slowed, down 16% in the week ending October 6. He noted two-year averages remained consistent with recent trends.
The analyst attributed the slowdown to lapping a brief East Coast port strike. Modi said that strike spurred temporary consumer stockpiling across many categories.
Modi expects guidance to be reiterated and prefers the low to the midpoint of ranges.
Macro, Regional Trends, And Tariffs
He said management sounded fine at an early-September industry conference. The analyst noted growth, tariffs, commodities, and FX were “not great but stable.”
Management’s top priority, he added, is reaccelerating global market growth.
Modi said global market growth held around 2% to 2.5%, slower than LTM yet acceptable.
North America tracked 2% to 3% growth with limited volume, but stabilizing. Europe appeared to be flattening, with focus markets roughly flat and enterprise markets still expanding.
China remained difficult, though strategies are “moving into positive trajectory,” according to Modi.
U.S. retail inventory adjustments were not expected to matter, with none anticipated in the first quarter.
The tariff backdrop stayed fluid, with gross impact reduced from $1 billion to $700–$750 million.
Modi expects limited P&L effects from tariffs after the reduction.
The largest change involved reciprocal tariffs in Canada, he added.
Overall, Modi expects a slow fiscal start, with the first quarter near P&G’s guidance low end. He said macro uncertainty persists, yet guidance should remain within intentionally wide, low ranges.
Modi sees U.S. growth as the key swing factor, now trending 1.5% to 2.5%.
Price Action: PG shares were trading lower by 0.16% to $151.96 at last check Thursday.
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