PG - Embedded Expectations Analysis - 2020 06 04
The Procter & Gamble Company (PG:USA) currently trades near historical averages relative to UAFRS-based (Uniform) earnings, with a 24.6x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may be concerned about sales growth, productivity initiatives, and changing consumer spending habitsSpecifically, management may lack confidence in their ability to meet their free cash flow productivity guidance, continue to beat organic sales growth expectations, and prevent significant market share declines in their Family Care category. In addition, they may be exaggerating the progress of their productivity initiatives and the strength of their business positioning. Moreover, they may have concerns about economic uncertainty, the sustainability of consumption increases for Bounty, Swiffer, and Mr. Clean, and their ability to raise their dividend payout ratio. Furthermore, they may lack confidence in their ability to achieve their monthly face mask production target and adapt to changing consumer habits and consumption level
Procter & Gamble provides consumer packaged goods. The company's products are sold primarily through mass merchandisers, e-commerce, grocery stores, membership club stores, drug stores, department stores, distributors, wholesalers, baby stores, beauty stores, other stores and pharmacies. The company has five reportable segments: Beauty, which includes hair care, and skin and personal care products; Grooming, which includes shave care products; Health Care, which includes oral care and personal health care products; Fabric and Home Care, which includes fabric care and home care products; and Baby, Feminine and Family Care, which includes baby care, feminine care and family care products.
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