Section 1: Company Overview and Fundamentals

1.1 Company Overview:

The Procter & Gamble Company is focused on providing branded consumer packaged goods to consumers across the world. The Company operates through five segments: Beauty; Grooming; Health Care; Fabric & Home Care, and Baby, Feminine & Family Care. The Company sells its products through approximately 180 countries and territories primarily through mass merchandisers, grocery stores, membership club stores, drug stores, department stores, distributors, wholesalers, baby stores, specialty beauty stores, e-commerce, high-frequency stores, pharmacies, electronics stores, and professional channels.

1,2 The Key Positives, Negatives, and Investment summary

1.3 Top 10 Shareholders:

The top 10 shareholders together form ~26.35% of the total shareholding. The Vanguard Group, Inc. and BlackRock Institutional Trust Company, N.A. are holding the maximum stake in the company at ~9.32% and ~4.69%, respectively.

1.4 Key Metrics:

PG has shown a higher profit margin across all the segments in FY22 when compared to the industry median, which demonstrates efficient resource allocation and operational efficiency. Additionally, PG is having lower balance sheet risk in FY22 when compared to the industry median due to improvement in revenues, margin expansion, and efficient cost of management. The last chart shows that PG is having a consistent dividend-paying history. Over the past ten years, the dividend has increased at an annual compound average rate of 5%.

1.4 Consistent dividend History

P&G has been paying a dividend for 132 consecutive years since its incorporation in 1890 and has increased its dividend for 66 consecutive years since 1956. Over the past ten years, the dividend has increased at an annual compound average rate of 5%. The dividend is paid every three months. PG’s Board of Directors has declared a quarterly dividend of USD 0.9133 per share on the Common Stock, payable on or after August 15, 2022, to Common Stock shareholders of record on July 22, 2022.

PG's Dividend Chart; Source: REFINITIV; Analysis by Kalkine Group

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates:

The below picture gives an overview of the recent updates:

2.2 Insights of FY22:

Section 3: Key Risks

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

4.2 Fundamental Valuation

Valuation Methodology: Price/Earnings Multiple-Based Relative Valuation

Markets are trading in a highly volatile zone currently due to certain macroeconomic and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance. 

Note 2: The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: The report publishing date is as per the Pacific Time Zone. 

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavorable movement in the stock prices.

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