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Definitive Analysis
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The Procter & Gamble Company (PG)

Company Dividend Discount ModelIndustry: Household & Personal ProductsSector: Consumer Defensive

Valuation Snapshot

Stable Growth$73.18 - $117.13$93.09
Multi-Stage$95.85 - $104.79$100.24
Blended Fair Value$96.66
Current Price$153.65
Upside-37.09%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS4.85%3.08%4.033.803.673.583.373.183.062.982.953.04
YoY Growth--6.01%3.48%2.61%6.14%6.09%3.88%2.57%1.02%-2.69%2.04%
Dividend Yield--2.62%2.19%2.52%2.84%2.41%2.29%2.46%3.57%3.25%3.38%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)16,765.00
(-) Cash Dividends Paid (M)9,976.00
(=) Cash Retained (M)6,789.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)3,353.002,095.631,257.38
Cash Retained (M)6,789.006,789.006,789.00
(-) Cash Required (M)-3,353.00-2,095.63-1,257.38
(=) Excess Retained (M)3,436.004,693.385,531.63
(/) Shares Outstanding (M)2,449.782,449.782,449.78
(=) Excess Retained per Share1.401.922.26
LTM Dividend per Share4.074.074.07
(+) Excess Retained per Share1.401.922.26
(=) Adjusted Dividend5.475.996.33
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate1.50%2.50%3.50%
Fair Value$73.18$93.09$117.13
Upside / Downside-52.37%-39.41%-23.77%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)16,765.0017,184.8517,615.2218,056.3618,508.5618,972.0719,541.23
Payout Ratio59.50%65.60%71.70%77.80%83.90%90.00%92.50%
Projected Dividends (M)9,976.0011,273.9412,630.6314,048.2115,528.8617,074.8618,075.64

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate1.50%2.50%3.50%
Year 1 PV (M)10,232.9610,333.7710,434.59
Year 2 PV (M)10,405.8210,611.8610,819.92
Year 3 PV (M)10,505.0410,818.5911,138.31
Year 4 PV (M)10,540.0310,961.5611,395.61
Year 5 PV (M)10,519.2611,047.7411,597.25
PV of Terminal Value (M)182,614.03191,788.41201,327.87
Equity Value (M)234,817.13245,561.92256,713.54
Shares Outstanding (M)2,449.782,449.782,449.78
Fair Value$95.85$100.24$104.79
Upside / Downside-37.62%-34.76%-31.80%

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