1Wk·

Would you buy Procter & Gamble right now?

$PG (-0.08%)

I've analyzed the stock in more detail and have summarized my findings here:

1. Moat: 8/10

Strong brands, massive advertising and sales power, high repurchase rate. That’s a real moat.
Risks include private labels, price-conscious shoppers, and weakness in North America. Organic growth in 2026 came entirely from prices (+1%); volume remained flat. So pricing power appears to be waning.
That’s why I’m giving it an 8 instead of a 9–10.

2. Financials: 6/10

Margins are excellent: EBIT margin approx. 23.5%, net margin approx. 18.4% (from your slide). However, the gross margin is declining, from 51.2% to 50.2%.
Growth is weak: 2027 forecast: organic growth of +1–3%, core EPS of $6.89–7.11 (0–3% growth). The estimates in the chart show revenue of +2.1%/+3.0%/+3.2% and earnings of +2.5%/+6.9%/+4.3% for 2027–29.
Added to this is a headwind of $1 billion due to higher costs, primarily for oil-based raw materials.
The margins are in line, but P&G is not currently delivering “impressive growth.”

3. Valuation: Fair to slightly expensive

The P/E ratio (NTM) of 22.3x is below the median of 23.3x and the 5-year average of 24.9x. However, growth has slowed, so the discount is justified and does not represent a bargain.
PEG 4.46 is above its own average of 4.14. That is high for a company with 2–3% profit growth.
EV/Sales of 4.4x compared to an average of 4.6x.
The average analyst price target of $161.65 offers only about 2.5% upside potential.

4. Balance Sheet: Solid, but Without a Buffer

Total debt: $34.1 billion; cash: $9.9 billion; net debt: $24.2 billion. This corresponds to approximately 1.0x EBITDA, and the interest coverage ratio is about 45x.
Noteworthy: The company plans to pay approximately $10 billion in dividends plus $5 billion in share buybacks. This exceeds free cash flow, which stood at $14.0 billion in fiscal year 2025. The difference is financed through debt, and interest expenses are projected to rise from $447 million to $611 million, according to the chart.
Not a disqualifying factor, but a warning sign.

Conclusion: HOLD

A high-quality company with a strong moat, but lacking growth and no longer undervalued. It lacks the growth needed for an “Overweight” rating, but the quality is too good for a “Sell” rating.

Judging by the results, it wouldn’t be a buy right now, but I have it in my portfolio and am even considering selling it because I think there are significantly better companies out there.

Does the crowd think the same way, or am I missing something here?

@Raketentoni

@Tenbagger-Capital

@Get_Rich_or_Die_Tryin

@Dividendenopi

@Olli68

22 Comments

Brian@Aktienhauptmeister

1Wk

In my opinion, P&G is only suitable for preserving wealth. Nothing more, nothing less.

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Marty0292@Marty0292

@Aktienhauptmeister To me, 9.5% annually over the past 20 years isn't just preserving wealth—it's above the market average.

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FinanzKeks@ImmoHai

1Wk

Why would I buy a slow grower that performs worse than my All World? -> No. And certainly not at the 52-week high.

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capital_captain_2693@capital_captain_2693

@ImmoHai I agree

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Maximilian@Max095

@ImmoHai Then your All World fund is also a slow grower. All World has yielded 7% per year, while the $PG has yielded 10% per year over the last 50 years.

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Kurz@MrKurt89

1Wk

I bought a large amount of $PG this year; I'm currently up 17% and plan to hold onto them for a very long time.

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DocTrader@value_crafter_1628

1Wk

I have $PG as a stabilizing force in my portfolio…🙂. It really does serve as a stabilizing force and is so wonderfully boring—my investment thesis remains intact….😆

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🏊🏻‍♂️ • 🚴• 🏃‍♂️ Endurance Life@MozartsGeist

1Wk

@value_crafter_1628 That's how it is ☝️

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Get_Rich_or_Die_Tryin@Get_Rich_or_Die_Tryin

1Wk

If it's consumer stocks, then I'd rather go with growth.😉 I prefer and hold $ATD and $MNST in my portfolio.👌🏻

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DividendenPapa@DividendenPapa

1Wk

First of all, what was your original investment thesis, and is it still fundamentally sound?

Personally, I think we need to take a nuanced view of $PG. Fundamentally, the stock offers a high-quality, defensive business model that can certainly provide more stability to an aggressively oriented portfolio.

However, I’m currently taking a more critical view of its “compounder” qualities as well: stagnant FCF per share, dividend growth outpacing FCF growth, and margin pressure. Added to this is what I see as a virtually nonexistent margin of safety. In this regard, I agree with the previous speakers regarding valuation and growth prospects.

I am not currently invested myself and have $PG only on my watchlist. However, I don’t currently see a near-term buying opportunity for myself either.

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Olli@Olli68

1Wk

If I were expecting a crash or a bear market, I'd like to have you in my portfolio.

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capital_captain_2693@capital_captain_2693

@Olli68 Don't you expect any market turbulence?

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Olli@Olli68

@capital_captain_2693 Yeah, a little.

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Phil@PhilPS

1Wk

I don't see any reason to hold this stock. Growth is super slow, and the dividend is just average 🤷🏻‍♂️

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Gomerdoc@Gomerdoc

@Tenbagger-Capital $KRI It's performed pretty well over the last five years. But if you look at the data from the last 20 years:
You wouldn't have made a single euro with this thing for the first 15 years.
It’s a relatively small company—so small that any department head at $PG could just swallow it whole if it starts getting in the way 😉.

$PG It increased its revenue by 7% to $21 billion in the past fiscal year and its profit by 4% to $3.9 billion.

It’s a matter of fundamental perspective. Procter & Gamble is the world’s largest consumer goods company; more than 50% of all households on the planet use its products daily, and of course they also have expensive brands.
But: everyone needs to use what they sell, even if the economy goes down the drain or other megatrends flop.
And if the products are too expensive, they’ll just bring cheaper ones to market.
For someone looking for a solid core investment that holds its value over the long term and generates more and more returns year after year, this is the right choice.

For those seeking higher returns, quicker profits, trading opportunities, and excitement: probably not.

And right now, that’s a good entry point—and, given the long-term trend, IMHO, a rather favorable one.

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Tenbagger-Capital@Tenbagger-Capital

@Gomerdoc Everything's fine, after all, and in a bear market, this stock is definitely more of a pleasure to hold than my other holdings. It's a stock that lets you sleep soundly.

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Marty0292@Marty0292

I wouldn't buy it until the price reached 120 euros

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Tenbagger-Capital@Tenbagger-Capital

Hi there, I’m more of a growth investor. You should ask the experts in the dividend sector: @Dividendenopi. But given rising inflation and rising commodity prices, I’m being rather cautious when it comes to consumer goods. As a result, consumers are buying fewer brand-name products. Personally, I’m invested in consumer goods through $ELF. I once wrote a post about $KRI. Otherwise, I also like $MNST (Monster) in the consumer goods sector. As for Coca-Cola, I’m still quite fond of the bottler. $COKE

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Aktienkoenig@Aktienkoenig

In my opinion, it's a little too late, since the stock has already rebounded somewhat. There are currently more interesting stocks out there.

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Dividendenopi👴@Dividendenopi

Since you already have it in your portfolio, take a moment to compare what has changed in your investment thesis to date. And see if it still fits your investment strategy. This is the stock of a real behemoth. Slow-moving, chugging along at a leisurely pace, it stays steady even in rough stock market waters. At my age, I generally like stocks like this, though personally, P&G pays me too little in dividends. If the rest of your portfolio is more aggressive, then my advice would be to keep it as a stabilizing anchor. For performance, don’t invest any more in P&G—instead, put that money into more promising stocks.

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Gomerdoc@Gomerdoc

@PhilPS @Dividendenopi Is a 3% dividend yield just average? ??

$PG has just announced its 70th consecutive dividend increase!

And if you take a look at the stock price since 1985 (from the bottom left to the top right—almost as if drawn with a ruler) and calculate your personal dividend yield based on buying this stock ten or 15 years ago:
You won’t be able to stop grinning.

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Dividendenopi👴@Dividendenopi

@Gomerdoc That's right; the question was whether she would buy P&G right now.

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