Procter & Gamble Started as an “Outperform” at Wells Fargo (PG)

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Consumer products maker The Procter & Gamble Company ( PG ) on Thursday saw its coverage initiated with an "Outperform" rating by analysts at Wells Fargo.

The firm also set a $70-73 valuation range on the stock, which implies a 7% to 12% upside to the stock's Wednesday closing price of $65.35.

A Wells Fargo analyst commented, "Our positive view within our Market Weight Household and Personal Care sector rating is based on (1) P&G's industry leading R&D investments, (2) penetration acceleration in developing and emerging (D&E) markets (i.e., more relative runway vs. competitors), and (3) leveraging both scale and financial strength to grow earnings. Near-term gross margin should be restrained by rising input costs. Long-term gross/op margin expansion should be driven by ongoing cost savings initiatives, improving business/product mix, and leveraging distribution expansion…Our FY '11/'12 EPS estimates of $3.98/$4.39."

Procter & Gamble shares were mostly flat in premarket trading Thursday.

The Bottom Line
We have been recommending shares of Procter & Gamble ( PG ) since Sept.1, 2009, when the stock was trading at $54.11. The company has a 2.95% dividend yield, based on last night's closing stock price of $65.35.

The Procter & Gamble Company ( PG ) is a "Recommended" dividend stock, holding a DARS™ Rating of 3.5 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Stocks

Referenced Stocks: PG

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