PROCTER & GAMBLE CO/THE (PG) Stock Fundamental Analysis
NYSE:PG - New York Stock Exchange, Inc. - US7427181091 - Common Stock - Currency: USD
Overall PG gets a fundamental rating of 6 out of 10. We evaluated PG against 12 industry peers in the Household Products industry. PG has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. PG does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
PG had positive earnings in the past year.
In the past year PG had a positive cash flow from operations.
PG had positive earnings in each of the past 5 years.
PG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
PG's Return On Assets of 12.39% is fine compared to the rest of the industry. PG outperforms 75.00% of its industry peers.
PG has a better Return On Equity (29.69%) than 66.67% of its industry peers.
PG's Return On Invested Capital of 18.25% is fine compared to the rest of the industry. PG outperforms 66.67% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PG is in line with the industry average of 15.44%.
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 Profit Margin of 18.01%. This is amongst the best in the industry. PG outperforms 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.
PG's Operating Margin has improved in the last couple of years.
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.
PG's Gross Margin has been stable in the last couple of years.
| 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so PG is creating value.
Compared to 1 year ago, PG has less shares outstanding
The number of shares outstanding for PG has been reduced compared to 5 years ago.
Compared to 1 year ago, PG has an improved debt to assets ratio.
2.2 Solvency
PG has an Altman-Z score of 5.97. This indicates that PG is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 5.97, PG is doing good in the industry, outperforming 75.00% of the companies in the same industry.
PG has a debt to FCF ratio of 2.24. This is a good value and a sign of high solvency as PG would need 2.24 years to pay back of all of its debts.
PG has a better Debt to FCF ratio (2.24) than 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.
The Debt to Equity ratio of PG (0.49) is better than 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.24 | ||
| Altman-Z | 5.97 |
ROIC/WACC2.13
WACC8.58%
2.3 Liquidity
A Current Ratio of 0.76 indicates that PG may have some problems paying its short term obligations.
PG has a Current ratio of 0.76. This is amonst the worse of the industry: PG underperforms 91.67% of its industry peers.
A Quick Ratio of 0.55 indicates that PG may have some problems paying its short term obligations.
PG's Quick ratio of 0.55 is on the low side compared to the rest of the industry. PG is outperformed by 83.33% of its industry peers.
PG does not score too well on the current and quick ratio evaluation. However, as it has 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
The Earnings Per Share has been growing slightly by 4.99% over the past year.
PG shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 7.78% yearly.
The Revenue has been growing slightly by 0.49% in the past 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 5.49% yearly.
PG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.32% yearly.
EPS Next Y7.24%
EPS Next 2Y6.63%
EPS Next 3Y6.68%
EPS Next 5Y5.49%
Revenue Next Year0.65%
Revenue Next 2Y1.85%
Revenue Next 3Y2.56%
Revenue Next 5Y3.32%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 24.63, which indicates a rather expensive current valuation of PG.
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.
PG's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.63.
The Price/Forward Earnings ratio is 22.12, which indicates a rather expensive current valuation of PG.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PG is on the same level as its industry peers.
PG is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 20.85, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.63 | ||
| Fwd PE | 22.12 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PG is valued a bit more expensive than the industry average as 75.00% of the companies are valued more cheaply.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PG indicates a slightly more expensive valuation: PG is more expensive than 66.67% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.13 | ||
| EV/EBITDA | 18.33 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of PG may justify a higher PE ratio.
PEG (NY)3.4
PEG (5Y)3.16
EPS Next 2Y6.63%
EPS Next 3Y6.68%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.48%, PG has a reasonable but not impressive dividend return.
PG's Dividend Yield is comparable with the industry average which is at 2.74.
PG's Dividend Yield is comparable with the S&P500 average which is at 2.51.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.48% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.65%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
63.32% of the earnings are spent on dividend by PG. This is not a sustainable payout ratio.
PG's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP63.32%
EPS Next 2Y6.63%
EPS Next 3Y6.68%
165.75
-4.88 (-2.86%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupHousehold & Personal Products
GICS IndustryHousehold Products
Earnings (Last)
Earnings (Next)
Inst Owners69.64%
Inst Owner Change0.65%
Ins Owners0.04%
Ins Owner Change-0.53%
Market Cap388.66B
Analysts77.84
Price Target183.94 (10.97%)
Short Float %0.77%
Short Ratio2.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.48% |
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)-0.09%
PT rev (3m)-1.61%
EPS NQ rev (1m)-3%
EPS NQ rev (3m)-5.06%
EPS NY rev (1m)-0.95%
EPS NY rev (3m)-1.32%
Revenue NQ rev (1m)-1.55%
Revenue NQ rev (3m)-3.17%
Revenue NY rev (1m)-0.38%
Revenue NY rev (3m)-0.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.63 | ||
| Fwd PE | 22.12 | ||
| P/S | 4.61 | ||
| P/FCF | 25.13 | ||
| P/OCF | 20.49 | ||
| P/B | 7.6 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.33 |
EPS(TTM)6.73
EY4.06%
EPS(NY)7.49
Fwd EY4.52%
FCF(TTM)6.6
FCFY3.98%
OCF(TTM)8.09
OCFY4.88%
SpS35.97
BVpS21.82
TBVpS-4.5
PEG (NY)3.4
PEG (5Y)3.16
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 | 5.97 |
F-Score7
WACC8.58%
ROIC/WACC2.13
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 Y7.24%
EPS Next 2Y6.63%
EPS Next 3Y6.68%
EPS Next 5Y5.49%
Revenue 1Y (TTM)0.49%
Revenue growth 3Y3.35%
Revenue growth 5Y4.42%
Sales Q2Q%2.06%
Revenue Next Year0.65%
Revenue Next 2Y1.85%
Revenue Next 3Y2.56%
Revenue Next 5Y3.32%
EBIT growth 1Y1.09%
EBIT growth 3Y3.51%
EBIT growth 5Y6.61%
EBIT Next Year19.68%
EBIT Next 3Y10.25%
EBIT Next 5Y6.74%
FCF growth 1Y33.75%
FCF growth 3Y1.97%
FCF growth 5Y6.79%
OCF growth 1Y29.88%
OCF growth 3Y2.61%
OCF growth 5Y5.42%