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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$73.36 - $117.51$93.34
Multi-Stage$96.15 - $105.11$100.55
Blended Fair Value$96.95
Current Price$153.65
Upside-36.91%
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 Rate9.08%9.08%9.08%
Growth Rate1.50%2.50%3.50%
Fair Value$73.36$93.34$117.51
Upside / Downside-52.26%-39.25%-23.52%

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 Rate9.08%9.08%9.08%
Growth Rate1.50%2.50%3.50%
Year 1 PV (M)10,234.6510,335.4810,436.31
Year 2 PV (M)10,409.2510,615.3610,823.49
Year 3 PV (M)10,510.2410,823.9411,143.83
Year 4 PV (M)10,546.9910,968.8011,403.14
Year 5 PV (M)10,527.9411,056.8611,606.82
PV of Terminal Value (M)183,305.83192,514.96202,090.56
Equity Value (M)235,534.90246,315.40257,504.14
Shares Outstanding (M)2,449.782,449.782,449.78
Fair Value$96.15$100.55$105.11
Upside / Downside-37.43%-34.56%-31.59%

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