NEW YORK (AP) — Shares of Procter & Gamble Co., maker of Tide laundry detergent and Gillette shavers, rose Friday after a Citi Investment Research analyst upgraded the stock to "Buy," praising the company's new price-cutting strategy.
Shares rose $1.82, or 3.3 percent, to $57.35 during morning trading. The stock has traded between $43.93 and $72.96 over the past year. Shares rose $1.82, or 3.3 percent, to $57.35 during morning trading.
Analyst Wendy Nicholson said in a client note that there is a new "fire in PG's belly," when it comes to cutting prices to win back market share to win back consumers who have traded down to cheaper store brands amid the recession.
Earlier this week P&G said it expects sales to begin rebounding in the fall as it cuts prices and adds new versions of its consumer products that emphasize value.
"With P&G perhaps having played nice for a bit too long — having raised prices with the hopes of boosting category profitability and yet losing market share as competitors did not fully follow — P&G is readying itself to become more aggressive in order to win back lost market share," she wrote.
She said that success with the price-cutting initiatives is not a given, however, because the competitive environment is tough and details of P&G's plans aren't known.
Still, she said the company's stock is likely at trough levels and raised her rating to "Buy" from "Hold."
She raised her target price on the stock to $66 from $54.