PROCTER & GAMBLE CO/THE (PG) Stock Fundamental Analysis
NYSE:PG - New York Stock Exchange, Inc. - US7427181091 - Common Stock - Currency: USD
Taking everything into account, PG scores 6 out of 10 in our fundamental rating. PG was compared to 12 industry peers in the Household Products industry. PG gets an excellent profitability rating and is at the same time showing great financial health properties. PG is valued expensive and it does not seem to be growing.
1. Profitability
1.1 Basic Checks
PG had positive earnings in the past year.
PG had a positive operating cash flow in the past year.
Each year in the past 5 years PG has been profitable.
Each year in the past 5 years PG had a positive operating cash flow.
1.2 Ratios
The Return On Assets of PG (12.39%) is better than 66.67% of its industry peers.
PG's Return On Equity of 29.69% is fine compared to the rest of the industry. PG outperforms 66.67% of its industry peers.
With a Return On Invested Capital value of 18.25%, PG perfoms like the industry average, outperforming 58.33% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for PG is in line with the industry average of 15.71%.
The 3 year average ROIC (16.90%) for PG is below the current ROIC(18.25%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.39% | ||
| ROE | 29.69% | ||
| ROIC | 18.25% |
ROA(3y)12.05%
ROA(5y)11.7%
ROE(3y)30.21%
ROE(5y)29.67%
ROIC(3y)16.9%
ROIC(5y)16.08%
1.3 Margins
PG has a better Profit Margin (18.01%) than 100.00% of its industry peers.
PG's Profit Margin has improved in the last couple of years.
The Operating Margin of PG (24.02%) is better than 100.00% of its industry peers.
In the last couple of years the Operating Margin of PG has grown nicely.
With an excellent Gross Margin value of 51.59%, PG belongs to the best of the industry, outperforming 83.33% of the companies in the same industry.
In the last couple of years the Gross Margin of PG has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.02% | ||
| PM (TTM) | 18.01% | ||
| GM | 51.59% |
OM growth 3Y0.15%
OM growth 5Y2.1%
PM growth 3Y-1.98%
PM growth 5Y26.46%
GM growth 3Y0.17%
GM growth 5Y0.73%
2. Health
2.1 Basic Checks
PG has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, PG has less shares outstanding
Compared to 5 years ago, PG has less shares outstanding
Compared to 1 year ago, PG has an improved debt to assets ratio.
2.2 Solvency
PG has an Altman-Z score of 6.07. This indicates that PG is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 6.07, PG is doing good in the industry, outperforming 75.00% of the companies in the same industry.
The Debt to FCF ratio of PG is 2.24, which is a good value as it means it would take PG, 2.24 years of fcf income to pay off all of its debts.
PG has a Debt to FCF ratio of 2.24. This is in the better half of the industry: PG outperforms 75.00% of its industry peers.
PG has a Debt/Equity ratio of 0.49. This is a healthy value indicating a solid balance between debt and equity.
PG has a Debt to Equity ratio of 0.49. This is in the better half of the industry: PG outperforms 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.24 | ||
| Altman-Z | 6.07 |
ROIC/WACC2.12
WACC8.59%
2.3 Liquidity
PG has a Current Ratio of 0.76. This is a bad value and indicates that PG is not financially healthy enough and could expect problems in meeting its short term obligations.
PG has a worse Current ratio (0.76) than 91.67% of its industry peers.
PG has a Quick Ratio of 0.76. This is a bad value and indicates that PG is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of PG (0.55) is worse than 83.33% of its industry peers.
The current and quick ratio evaluation for PG is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.76 | ||
| Quick Ratio | 0.55 |
3. Growth
3.1 Past
PG shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.99%.
PG shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 7.78% yearly.
Looking at the last year, PG shows a small growth in Revenue. The Revenue has grown by 0.49% in the last year.
PG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.42% yearly.
EPS 1Y (TTM)4.99%
EPS 3Y5.2%
EPS 5Y7.78%
EPS Q2Q%2.17%
Revenue 1Y (TTM)0.49%
Revenue growth 3Y3.35%
Revenue growth 5Y4.42%
Sales Q2Q%2.06%
3.2 Future
PG is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.24% yearly.
The Revenue is expected to grow by 3.21% on average over the next years.
EPS Next Y8.27%
EPS Next 2Y7.29%
EPS Next 3Y7.21%
EPS Next 5Y6.24%
Revenue Next Year1.04%
Revenue Next 2Y2.11%
Revenue Next 3Y2.7%
Revenue Next 5Y3.21%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
PG is valuated quite expensively with a Price/Earnings ratio of 26.14.
PG's Price/Earnings ratio is a bit more expensive when compared to the industry. PG is more expensive than 66.67% of the companies in the same industry.
When comparing the Price/Earnings ratio of PG to the average of the S&P500 Index (29.35), we can say PG is valued inline with the index average.
With a Price/Forward Earnings ratio of 23.20, PG is valued on the expensive side.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PG is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 22.10. PG is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.14 | ||
| Fwd PE | 23.2 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PG is valued a bit more expensive than 75.00% of the companies in the same industry.
PG's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.67 | ||
| EV/EBITDA | 18.87 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PG has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.16
PEG (5Y)3.36
EPS Next 2Y7.29%
EPS Next 3Y7.21%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.31%, PG has a reasonable but not impressive dividend return.
PG's Dividend Yield is comparable with the industry average which is at 2.57.
PG's Dividend Yield is comparable with the S&P500 average which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
5.2 History
The dividend of PG has a limited annual growth rate of 5.65%.
PG has paid a dividend for at least 10 years, which is a reliable track record.
PG has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.65%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
PG pays out 63.32% of its income as dividend. This is not a sustainable payout ratio.
PG's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP63.32%
EPS Next 2Y7.29%
EPS Next 3Y7.21%
175.95
+1.29 (+0.74%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupHousehold & Personal Products
GICS IndustryHousehold Products
Earnings (Last)
Earnings (Next)
Inst Owners69.64%
Inst Owner Change0.58%
Ins Owners0.04%
Ins Owner Change0.29%
Market Cap412.58B
Analysts77.84
Price Target184.1 (4.63%)
Short Float %0.84%
Short Ratio2.7
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
Yearly Dividend3.95
Dividend Growth(5Y)5.65%
DP63.32%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-1.47%
Min EPS beat(2)-1.67%
Max EPS beat(2)-1.27%
EPS beat(4)1
Avg EPS beat(4)0.12%
Min EPS beat(4)-1.67%
Max EPS beat(4)4.36%
EPS beat(8)5
Avg EPS beat(8)1.27%
EPS beat(12)5
Avg EPS beat(12)0.17%
EPS beat(16)7
Avg EPS beat(16)0.13%
Revenue beat(2)0
Avg Revenue beat(2)-2.54%
Min Revenue beat(2)-3.7%
Max Revenue beat(2)-1.38%
Revenue beat(4)0
Avg Revenue beat(4)-3.22%
Min Revenue beat(4)-3.92%
Max Revenue beat(4)-1.38%
Revenue beat(8)1
Avg Revenue beat(8)-2.11%
Revenue beat(12)2
Avg Revenue beat(12)-1.9%
Revenue beat(16)4
Avg Revenue beat(16)-1.59%
PT rev (1m)0.13%
PT rev (3m)-1.18%
EPS NQ rev (1m)-0.31%
EPS NQ rev (3m)-1.85%
EPS NY rev (1m)-0.06%
EPS NY rev (3m)-0.45%
Revenue NQ rev (1m)-0.21%
Revenue NQ rev (3m)-1.4%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)-0.67%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.14 | ||
| Fwd PE | 23.2 | ||
| P/S | 4.89 | ||
| P/FCF | 26.67 | ||
| P/OCF | 21.75 | ||
| P/B | 8.06 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.87 |
EPS(TTM)6.73
EY3.82%
EPS(NY)7.59
Fwd EY4.31%
FCF(TTM)6.6
FCFY3.75%
OCF(TTM)8.09
OCFY4.6%
SpS35.97
BVpS21.82
TBVpS-4.5
PEG (NY)3.16
PEG (5Y)3.36
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.39% | ||
| ROE | 29.69% | ||
| ROCE | 22.8% | ||
| ROIC | 18.25% | ||
| ROICexc | 20.63% | ||
| ROICexgc | 96.06% | ||
| OM | 24.02% | ||
| PM (TTM) | 18.01% | ||
| GM | 51.59% | ||
| FCFM | 18.34% |
ROA(3y)12.05%
ROA(5y)11.7%
ROE(3y)30.21%
ROE(5y)29.67%
ROIC(3y)16.9%
ROIC(5y)16.08%
ROICexc(3y)18.64%
ROICexc(5y)18.08%
ROICexgc(3y)84.41%
ROICexgc(5y)84.26%
ROCE(3y)22.01%
ROCE(5y)21.21%
ROICexcg growth 3Y2.85%
ROICexcg growth 5Y6.24%
ROICexc growth 3Y4.33%
ROICexc growth 5Y7.11%
OM growth 3Y0.15%
OM growth 5Y2.1%
PM growth 3Y-1.98%
PM growth 5Y26.46%
GM growth 3Y0.17%
GM growth 5Y0.73%
F-Score7
Asset Turnover0.69
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.24 | ||
| Debt/EBITDA | 1.09 | ||
| Cap/Depr | 120.33% | ||
| Cap/Sales | 4.15% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 81.88% | ||
| Profit Quality | 101.82% | ||
| Current Ratio | 0.76 | ||
| Quick Ratio | 0.55 | ||
| Altman-Z | 6.07 |
F-Score7
WACC8.59%
ROIC/WACC2.12
Cap/Depr(3y)113.32%
Cap/Depr(5y)108.77%
Cap/Sales(3y)3.87%
Cap/Sales(5y)3.92%
Profit Quality(3y)100.99%
Profit Quality(5y)105.25%
High Growth Momentum
Growth
EPS 1Y (TTM)4.99%
EPS 3Y5.2%
EPS 5Y7.78%
EPS Q2Q%2.17%
EPS Next Y8.27%
EPS Next 2Y7.29%
EPS Next 3Y7.21%
EPS Next 5Y6.24%
Revenue 1Y (TTM)0.49%
Revenue growth 3Y3.35%
Revenue growth 5Y4.42%
Sales Q2Q%2.06%
Revenue Next Year1.04%
Revenue Next 2Y2.11%
Revenue Next 3Y2.7%
Revenue Next 5Y3.21%
EBIT growth 1Y1.09%
EBIT growth 3Y3.51%
EBIT growth 5Y6.61%
EBIT Next Year20.36%
EBIT Next 3Y10.7%
EBIT Next 5Y7.23%
FCF growth 1Y33.75%
FCF growth 3Y1.97%
FCF growth 5Y6.79%
OCF growth 1Y29.88%
OCF growth 3Y2.61%
OCF growth 5Y5.42%