Word on the Street: Buy Gillette

With most of the U.S. stock market in a slump, analysts continue to recommend household and personal care stocks. UBS Warburg on Monday upgraded the household products sector to “overweight” from “market weight,” citing attractive stock prices and strong industry fundamentals.

The firm raised its investment ratings on Gillette Co. “strong buy” from “hold,” and Procter & Gamble Co. “strong buy” from “buy.” Both Alberto Culver Co. and Clorox Co. were upgraded to “buy” from “hold.”

“Volumes are healthy, raw material costs appear benign through the calendar year, competitive pressures remain limited and recent euro/yen strength is a positive sector wide,” analyst Andrew McQuilling wrote in a research note.

Mr. McQuilling said the outlook for the remainder of 2002 looked most positive for P&G and Gillette, given easy comparisons with a year earlier, restructuring savings, improving business momentum and significant Euro region exposure.