PG
DefensiveProcter & Gamble
Price Chart
Market Data
Financials
XBRL · SEC EDGAR2008–2025(18yr)| Metric | FY 2008 | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $79.3B | $76.7B | $78.9B | $82.6B | $28.4B | $29.2B | $29.4B | $76.3B | $65.3B | $65.1B | $66.8B | $67.7B | $71.0B | $76.1B | $80.2B | $82.0B | $84.0B | $84.3B | +0.3% |
| Gross Profit | $40.0B | $38.0B | $41.0B | $41.8B | -$14.0B | -$13.2B | -$13.1B | $37.4B | $32.4B | $32.4B | $32.4B | $32.9B | $35.7B | $39.0B | $38.0B | $39.2B | $43.2B | $43.1B | -0.2% |
| Gross Margin | 50.5% | 49.6% | 52.0% | 50.6% | -49.3% | -45.3% | -44.4% | 49.0% | 49.6% | 49.8% | 48.5% | 48.6% | 50.3% | 51.2% | 47.4% | 47.9% | 51.4% | 51.2% | -0.2pp |
| Operating Income | $16.0B | $15.4B | $16.0B | $15.8B | $13.3B | $14.5B | $15.3B | $11.8B | $13.4B | $14.0B | $13.7B | $5.5B | $15.7B | $18.0B | $17.8B | $18.1B | $18.5B | $20.5B | +10.3% |
| Operating Margin | 20.2% | 20.0% | 20.3% | 19.2% | 46.8% | 49.6% | 52.0% | 15.5% | 20.6% | 21.5% | 20.5% | 8.1% | 22.1% | 23.6% | 22.2% | 22.1% | 22.1% | 24.3% | +2.2pp |
| Net Income | $12.1B | $13.4B | $12.7B | $11.8B | $10.8B | $11.3B | $11.6B | $7.0B | $10.5B | $15.3B | $9.8B | $3.9B | $13.0B | $14.3B | $14.7B | $14.7B | $14.9B | $16.0B | +7.4% |
| Net Margin | 15.2% | 17.5% | 16.1% | 14.3% | 37.9% | 38.7% | 39.6% | 9.2% | 16.1% | 23.6% | 14.6% | 5.8% | 18.4% | 18.8% | 18.4% | 17.9% | 17.7% | 19.0% | +1.2pp |
| Free Cash Flow | $12.0B | $11.7B | $13.0B | $9.9B | $9.3B | $10.9B | $10.1B | $10.9B | $12.1B | $9.4B | $11.2B | $11.9B | $14.3B | $15.6B | $13.6B | $13.8B | $16.5B | $14.0B | -15.0% |
| FCF Margin | 15.1% | 15.2% | 16.5% | 12.0% | 32.8% | 37.2% | 34.4% | 14.3% | 18.6% | 14.4% | 16.7% | 17.6% | 20.2% | 20.5% | 16.9% | 16.8% | 19.7% | 16.7% | -3.0pp |
| EPS (Diluted) | $3.64 | $4.26 | $4.11 | $3.93 | $3.66 | $3.86 | $4.01 | $2.44 | $3.69 | $5.59 | $3.67 | $1.43 | $4.96 | $5.50 | $5.81 | $5.90 | $6.02 | $6.51 | +8.1% |
1. THE BIG PICTURE
Procter & Gamble is currently a story of internal efficiency rather than external expansion. While Procter & Gamble pursues "irresistible superiority" across its brands, it is finding that superiority easier to maintain in its profit margins than in its sales growth, which has slowed to just 0.3% (XBRL). By prioritizing a "develop-from-within" leadership model and aggressive capital returns, Procter & Gamble is effectively manufacturing earnings growth from a stagnant revenue base.
2. WHERE THE RISKS HIT HARDEST
Procter & Gamble’s "irresistible superiority" strategy in product performance and value (10-K Item 1) is directly threatened by commodity price volatility in resins and pulp. If Procter & Gamble cannot offset these rising input costs through pricing or productivity, the "value" vector of its strategy collapses. Furthermore, its global leadership—selling in 180 countries—is a structural vulnerability; with over 50% of sales generated outside the U.S., foreign currency fluctuations frequently erase gains made in local markets (10-K Item 1A). Finally, Procter & Gamble’s reliance on "single-source suppliers" for certain raw materials creates a bottleneck that could instantly derail its "retail execution" advantage if a single vendor faces a labor dispute or natural disaster (10-K Item 1).
3. WHAT THE NUMBERS SAY TOGETHER
The financial data reveals a company successfully defending its bottom line in a difficult environment. While revenue growth is marginal at 0.3% (XBRL), Procter & Gamble expanded its operating margin by 2.2 percentage points over the last year. This suggests that the "productivity improvements" cited by management are successfully funding the business even as volumes struggle. However, the most recent quarter shows a divergence: net earnings fell 7% despite a 1% increase in sales, a decline management attributes to incremental restructuring charges (8-K).
The growth trajectory is uneven across the portfolio. Beauty and Health Care remain bright spots with organic growth of 4% and 3% respectively, but these are offset by a 4% decline in the Baby, Feminine & Family Care segment (8-K). This suggests the 1% quarterly growth is a slight improvement over the TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter average of 0.3%, but remains heavily dependent on pricing to offset volume declines in Grooming and flat performance in Fabric Care. With short interest at a low 1.1% of the float (Yahoo Finance), market sentiment remains stable, viewing the current stagnation as a manageable macro headwind rather than a structural failure.
4. IS IT WORTH IT AT THIS PRICE?
At 21.3x Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations, Procter & Gamble is trading exactly in line with the peer median (Yahoo Finance). This valuation appears justified given its superior capital allocation; Procter & Gamble leads its peer group with a 2.0% buyback yield, which is significantly higher than Coca-Cola (0.3%) or PepsiCo (0.5%).
At this multiple, the market is pricing in approximately 1.7% long-term growth (CAPM analysis). This is a conservative estimate that aligns with Procter & Gamble's fiscal 2026 guidance of 1% to 5% all-in sales growth (8-K). While Procter & Gamble has the lowest gross margin in its peer group at 51.5%—well below Philip Morris at 67.2%—its ability to convert 17.1% of revenue into free cash flow ranks it third among peers, ahead of Coca-Cola (XBRL). The primary risk to this valuation is a further strengthening of the U.S. dollar, which would make the 1.7% growth target harder to hit in reporting terms.
5. WHAT WOULD CHANGE THIS VIEW?
- Cautious if the 4% volume decline in the Family Care segment (8-K) accelerates or spreads to the Beauty segment, suggesting that "innovation-driven pricing" has reached its limit with consumers.
- Constructive if the "restructuring charges" that suppressed recent earnings (8-K) conclude, allowing the 2.2 percentage point operating margin expansion to flow directly into net income growth.
6. BOTTOM LINE
Structural Advantage: A "develop-from-within" leadership culture and an integrated strategy of "irresistible superiority" that maintains leadership positions across five distinct consumer categories.
Bottom Line: Procter & Gamble is a premier defensive holding that offers fair value for investors seeking high shareholder returns via buybacks rather than rapid top-line expansion.
1. Top 5 Material Risks
- Foreign Currency Volatility: With operations in approximately 70 countries and sales in 180, Procter & Gamble generates over 50% of its annual net sales outside the U.S. Fluctuations in exchange rates can reduce the U.S. dollar value of these sales, earnings, and cash flows, while also increasing supply costs.
- Geopolitical Instability: Changes in political conditions, trade policies, and sanctions can disrupt the movement of goods, capital, and data. The ongoing war between Russia and Ukraine has already forced Procter & Gamble to reduce its product portfolio and suspend media and promotional activity in Russia, with further potential for asset impairments or write-downs.
- Supply Chain Disruptions: Procter & Gamble’s ability to meet customer needs depends on maintaining key manufacturing and supply arrangements. Disruptions—ranging from labor disputes and natural disasters to cybersecurity incidents—can interrupt product supply and adversely impact financial results.
- Cost Fluctuations: Procter & Gamble is subject to price volatility in commodities (such as resins and pulp), labor, energy, and transportation. Failure to manage these costs through pricing actions or productivity projects can negatively affect margins and market share.
- Information Security and Technology: Procter & Gamble relies extensively on IT/OT systems for ordering materials, financial reporting, and managing liquidity. Cybersecurity threats, including ransomware and unauthorized access, pose a risk of operational outages, remediation costs, and potential regulatory fines.
2. Company-Specific Risks
- Retailer Concentration: Continued consolidation among retail customers creates cost and margin pressure; Procter & Gamble’s performance could suffer if it fails to reach agreement on trade terms with a key customer or if a customer reduces shelf space for Procter & Gamble products.
- Brand Reputation: The financial success of Procter & Gamble depends on the reputation of its brands. Negative publicity—whether from product recalls, litigation, or social media sentiment regarding environmental or social practices—can materially impact financial results.
- Acquisition and Divestiture Integration: Procter & Gamble’s business model includes ongoing portfolio management. Failure to deliver expected synergies from acquisitions or joint ventures, or changes in market-based assumptions, can lead to the impairment of goodwill and intangible assets.
- Succession and Talent Retention: Achieving growth targets depends on Procter & Gamble’s ability to attract and retain key talent and execute leadership transitions, particularly in growth markets where competition for skilled employees is intense.
3. Regulatory/Legal Risks
- Global Tax Legislation: While Procter & Gamble does not anticipate a material impact from the 2025 U.S. Tax Act or the OECD’s Pillar Two global minimum tax (15%), future revisions to these laws could materially affect the effective tax rate, cash flows, and financial condition.
- ESG Reporting and Compliance: Increasing governmental and societal focus on environmental, social, and governance (ESG) matters—including climate change, waste production, and human rights—expands the complexity of compliance and reporting, potentially increasing costs.
- Tax Audits: Procter & Gamble is subject to regular audits by domestic and foreign authorities. The final outcomes of these audits, including the tax treatment of past divestitures like the 2017 Beauty Brands transaction, could differ from recorded amounts and adversely impact results.
4. Financial Impact Map
Foreign Currency Fluctuations → Net Sales, Earnings, and Cash Flows → More than 50% of annual net sales are generated outside the U.S.
Geopolitical Conflicts (Russia/Ukraine) → Fixed Assets and Working Capital → Potential for impairments of manufacturing plants and write-downs of operating assets.
Cybersecurity Incidents → Results of Operations and Cash Flows → Potential for remediation costs, payment of fines, and loss of sensitive business information.
Commodity and Input Cost Fluctuations → Margins and Market Share → Requires management through pricing actions and cost-saving projects to maintain profitability.
Acquisition and Divestiture Activities → Goodwill and Intangible Assets → Risk of impairment if market-based assumptions fall below book value or synergies are not realized.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 10-Q | Jan 2026 | Dec 2025 |
| 8-K | Jan 2026 | — |
| 14A | Aug 2025 | — |
| 10-K | Aug 2025 | Jun 2025 |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
Deutsche Bank cuts P&G price target to $162, cites inflation and currency headwinds
- ▸Deutsche Bank lowers P&G price target to $162 from $171, maintains Hold rating
- ▸FY26 organic sales growth guidance remains unchanged at 4%
- ▸FY26 core EPS growth projected at 4%, range of $6.83 to $7.09
- ▸Planned $15 billion total shareholder return via $10B dividends and $5B buybacks
- ▸FY26 outlook includes $500 million in additional pre-tax costs from tariffs
RH Q4 EPS $1.53 misses estimates by 30.7%, revenue $842.6M misses by 3.4%
- ▸Q4 EPS $1.53 vs $2.21 consensus estimate
- ▸Q4 revenue $842.62M vs $872.3M consensus estimate
- ▸Earnings surprise of -30.73% for the quarter
- ▸Stock has declined 26.3% year-to-date
- ▸Current Zacks Rank #4 (Sell) rating
TD Cowen cuts P&G price target to $142, citing Iran war-related input cost inflation
- ▸TD Cowen cut P&G price target to $142 from $156, maintains Hold rating
- ▸Q2 FY2026 net sales $22.21B, missing $22.29B estimate
- ▸Q2 FY2026 operating income fell 6.53% YoY to $5.366B
- ▸Core gross margin contracted 50 basis points in Q2 FY2026
- ▸Management projects $400M in after-tax tariff costs for FY2026
Erste Group downgrades PG to Hold, cites sluggish growth and consumer sentiment
- ▸Erste Group downgraded PG from Buy to Hold on March 24, 2026
- ▸FY sales growth guidance reiterated at 1% to 5% YoY
- ▸FY EPS growth guidance reiterated at 1% to 6% YoY
- ▸Consensus price target of $171 implies 20% upside
- ▸Launched premium Pampers AMORE diaper line on March 16, 2026
Procter & Gamble launches premium product line amid $400M tariff headwind
- ▸Launched premium products including Pampers AMORE and Swiffer PowerMop upgrades
- ▸Facing $400 million tariff headwind impacting near-term margin outlook
- ▸Projected 2029 revenue $94.0 billion, earnings $18.2 billion
- ▸Requires 3.3% annual revenue growth to meet long-term targets
- ▸Current management navigating CEO transition and rising energy costs
Procter & Gamble to invest $1B in new Gillette headquarters and technical center in Boston
- ▸Investing nearly $1B to build new flagship Gillette headquarters and technical center
- ▸Project consolidates research, engineering, manufacturing support, and business operations in Boston
- ▸P&G stock currently trading at $150.65, approximately 10% below analyst target
- ▸Company maintains $85.3B annual revenue base
- ▸Current P/E ratio of 21.7 exceeds household products industry average of 19.3