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 5 out of 10. We evaluated PG against 12 industry peers in the Household Products industry. PG scores excellent points on both the profitability and health parts. This is a solid base for a good stock. 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.
PG had a positive operating cash flow in the past year.
In the past 5 years PG has always been profitable.
Each year in the past 5 years PG had a positive operating cash flow.
1.2 Ratios
With a Return On Assets value of 12.36%, PG perfoms like the industry average, outperforming 58.33% of the companies in the same industry.
Looking at the Return On Equity, with a value of 29.09%, PG is in line with its industry, outperforming 58.33% of the companies in the same industry.
PG's Return On Invested Capital of 18.35% is fine compared to the rest of the industry. PG outperforms 66.67% of its industry peers.
PG had an Average Return On Invested Capital over the past 3 years of 16.90%. This is in line with the industry average of 15.82%.
The last Return On Invested Capital (18.35%) for PG is above the 3 year average (16.90%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.36% | ||
| ROE | 29.09% | ||
| ROIC | 18.35% |
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 18.12%. 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.
PG has a Operating Margin of 24.23%. This is amongst the best in the industry. PG outperforms 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 51.51%, 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 | 24.23% | ||
| PM (TTM) | 18.12% | ||
| GM | 51.51% |
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.
PG has less shares outstanding than it did 1 year ago.
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
An Altman-Z score of 5.76 indicates that PG is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 5.76, 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 2.27, which is a good value as it means it would take PG, 2.27 years of fcf income to pay off all of its debts.
PG has a Debt to FCF ratio of 2.27. This is amongst the best in the industry. PG outperforms 83.33% of its industry peers.
PG has a Debt/Equity ratio of 0.46. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.46, PG is doing good in the industry, outperforming 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.27 | ||
| Altman-Z | 5.76 |
ROIC/WACC2.13
WACC8.61%
2.3 Liquidity
A Current Ratio of 0.71 indicates that PG may have some problems paying its short term obligations.
PG has a worse Current ratio (0.71) than 91.67% of its industry peers.
PG has a Quick Ratio of 0.71. 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 (0.50) is worse than 75.00% 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 | 0.71 | ||
| Quick Ratio | 0.5 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.90% 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.
PG shows a decrease in Revenue. In the last year, the revenue decreased by -0.16%.
PG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.42% yearly.
EPS 1Y (TTM)2.9%
EPS 3Y5.2%
EPS 5Y7.78%
EPS Q2Q%1.32%
Revenue 1Y (TTM)-0.16%
Revenue growth 3Y3.35%
Revenue growth 5Y4.42%
Sales Q2Q%-2.07%
3.2 Future
Based on estimates for the next years, PG will show a small growth in Earnings Per Share. The EPS will grow by 4.60% on average per year.
Based on estimates for the next years, PG will show a small growth in Revenue. The Revenue will grow by 2.85% on average per year.
EPS Next Y5.81%
EPS Next 2Y4.53%
EPS Next 3Y5.1%
EPS Next 5Y4.6%
Revenue Next Year-0.14%
Revenue Next 2Y1.3%
Revenue Next 3Y2.06%
Revenue Next 5Y2.85%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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
A Price/Earnings ratio of 23.57 indicates a rather expensive 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 is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.35, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 22.09, the valuation of PG can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PG indicates a slightly more expensive valuation: PG is more expensive than 66.67% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.19. PG is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.57 | ||
| Fwd PE | 22.09 |
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.
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 75.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.82 | ||
| EV/EBITDA | 17.14 |
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)4.06
PEG (5Y)3.03
EPS Next 2Y4.53%
EPS Next 3Y5.1%
5. Dividend
5.1 Amount
PG has a Yearly Dividend Yield of 2.67%.
PG's Dividend Yield is comparable with the industry average which is at 3.08.
PG's Dividend Yield is comparable with the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.67% |
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
64.24% 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.
DP64.24%
EPS Next 2Y4.53%
EPS Next 3Y5.1%
159.08
+1.06 (+0.67%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupHousehold & Personal Products
GICS IndustryHousehold Products
Earnings (Last)
Earnings (Next)
Inst Owners70.1%
Inst Owner Change1.22%
Ins Owners0.04%
Ins Owner Change-0.46%
Market Cap372.97B
Analysts78.29
Price Target178.02 (11.91%)
Short Float %0.75%
Short Ratio2.12
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.67% |
Yearly Dividend3.95
Dividend Growth(5Y)5.65%
DP64.24%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-1.83%
Min EPS beat(2)-1.99%
Max EPS beat(2)-1.67%
EPS beat(4)0
Avg EPS beat(4)-1.47%
Min EPS beat(4)-1.99%
Max EPS beat(4)-0.96%
EPS beat(8)4
Avg EPS beat(8)0.95%
EPS beat(12)5
Avg EPS beat(12)0.02%
EPS beat(16)6
Avg EPS beat(16)-0.18%
Revenue beat(2)0
Avg Revenue beat(2)-2.94%
Min Revenue beat(2)-4.5%
Max Revenue beat(2)-1.38%
Revenue beat(4)0
Avg Revenue beat(4)-3.37%
Min Revenue beat(4)-4.5%
Max Revenue beat(4)-1.38%
Revenue beat(8)0
Avg Revenue beat(8)-2.78%
Revenue beat(12)1
Avg Revenue beat(12)-2.32%
Revenue beat(16)4
Avg Revenue beat(16)-1.76%
PT rev (1m)0.32%
PT rev (3m)-3.3%
EPS NQ rev (1m)0.09%
EPS NQ rev (3m)-7.17%
EPS NY rev (1m)0.05%
EPS NY rev (3m)-2.28%
Revenue NQ rev (1m)0.12%
Revenue NQ rev (3m)-1.58%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)-1.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.57 | ||
| Fwd PE | 22.09 | ||
| P/S | 4.44 | ||
| P/FCF | 24.82 | ||
| P/OCF | 20.07 | ||
| P/B | 7.14 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.14 |
EPS(TTM)6.75
EY4.24%
EPS(NY)7.2
Fwd EY4.53%
FCF(TTM)6.41
FCFY4.03%
OCF(TTM)7.93
OCFY4.98%
SpS35.8
BVpS22.3
TBVpS-4.28
PEG (NY)4.06
PEG (5Y)3.03
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.36% | ||
| ROE | 29.09% | ||
| ROCE | 22.92% | ||
| ROIC | 18.35% | ||
| ROICexc | 20.45% | ||
| ROICexgc | 94.06% | ||
| OM | 24.23% | ||
| PM (TTM) | 18.12% | ||
| GM | 51.51% | ||
| FCFM | 17.9% |
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 Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.27 | ||
| Debt/EBITDA | 1.04 | ||
| Cap/Depr | 123.4% | ||
| Cap/Sales | 4.24% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.04% | ||
| Profit Quality | 98.82% | ||
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.5 | ||
| Altman-Z | 5.76 |
F-Score7
WACC8.61%
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)2.9%
EPS 3Y5.2%
EPS 5Y7.78%
EPS Q2Q%1.32%
EPS Next Y5.81%
EPS Next 2Y4.53%
EPS Next 3Y5.1%
EPS Next 5Y4.6%
Revenue 1Y (TTM)-0.16%
Revenue growth 3Y3.35%
Revenue growth 5Y4.42%
Sales Q2Q%-2.07%
Revenue Next Year-0.14%
Revenue Next 2Y1.3%
Revenue Next 3Y2.06%
Revenue Next 5Y2.85%
EBIT growth 1Y0.07%
EBIT growth 3Y3.51%
EBIT growth 5Y6.61%
EBIT Next Year17.4%
EBIT Next 3Y8.63%
EBIT Next 5Y6.23%
FCF growth 1Y23.16%
FCF growth 3Y1.97%
FCF growth 5Y6.79%
OCF growth 1Y22.11%
OCF growth 3Y2.61%
OCF growth 5Y5.42%