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Analyst advises holding off on P&G stock

NEW YORK (AP) -- Procter & Gamble's results are improving, but the world's largest consumer product maker has to show more signs of sustainable growth before its shares are worth buying, an analyst said Thursday.

P&G's share price has been steadily rising this year, up about 13 percent, especially after the Cincinnati-based company posted results that beat analyst expectations for the second quarter in a row in January.

But UBS analyst Nik Modi said the company, which makes products ranging from Tide detergent to Febreeze air fresheners, has to show more signs of stability before he changes his "Hold" rating on the stock.

Modi said the stock price made a similar jump in 2010, when Robert McDonald took the helm of the company. However, as costs spiked, quarterly results took a hit and the share price dove in mid-2012.

Pricing missteps and lost market share have also weighed on profit. The company has cut costs and jobs and is focusing on its most profitable products and markets to turn the business around. Still, P&G's revenue growth is not as strong as that of competitors, Modi said.

However, he raised his 12-month price target to $75 from $66 to reflect P&G's improved results.

Shares rose 42 cents to $77.22 during midday trading.