CINCINNATI - A.G. Lafley got a hero’s welcome last year, when he returned to Procter & Gamble Co. for a second term as CEO. Now, it seems the welcome mat is wearing thin.
Recent option-trading activity indicates “a sudden surge in pessimism” in advance of P&G’s fourth quarter and full-year earnings report, which is due Aug. 1, said Todd Salamone, vice president of research for Schaeffer’s Investment Research in Blue Ash.
Short selling of P&G shares, which is a bet investors make when they think the stock price will fall, increased 54 percent in the two weeks ended June 30.
“Short interest on the shares is the highest it’s been since January, 2012,” Salamone added.
Wells Fargo & Co. downgraded P&G stock July 11 from outperform to market perform, saying its “market share trends have weakened in the face of competition” P&G’s “launch activity seems more vulnerable than ever” to the promotional activity of rivals.
“We have strong plans in place from an innovation and productivity standpoint,” said P&G spokesman Bryan McCleary, who notes that most analysts haven't changed their ratings on P&G and none are advising investors to sell.
Become a WCPO Insider to learn more about what Wall Street thinks of P&G as Lafley prepares to brief analysts on 2014 fiscal year results Aug. 1.