Ahead of the Bell: Analyst raises P&G price target

NEW YORK—Lehman Brothers raised its price target on Procter & Gamble Co. Thursday but stayed wary on operating profit growth, the day after the consumer products maker said price increases and emerging markets sales helped boost fiscal third-quarter income.

Analyst Lauren Lieberman raised her price target to $73 from $71, implying she expects the stock to rise about 9 percent over Wednesday's $67.05 close.

"We think P&G is operating well in a difficult environment, but we expect operating profit growth to slow modestly in fiscal 2009," Lieberman said in a note to clients. She rates shares "Equal-weight."

Sales will not likely accelerate and profitability will likely be strained by $2 billion in expected cost inflation, she said.

Lieberman raised her fiscal 2008 earnings estimate by a penny to $3.50 per share after the company's fiscal third-quarter earnings beat her estimates by 3 cents per share.

Analysts polled by Thomson Financial expect, on average, earnings of $3.49 for the fiscal year, which ends in June.

Shares of the Cincinnati-based company rose 35 cents to $67.40 in premarket trading Thursday.