◆ What the Market Isn't Pricing In

Procter & Gamble (PG) — the variant view

P&G has lost five points of multiple and lagged the market for five years, so at 21 times earnings its shares now offer a cash yield of about 4.7% rather than a safety premium.

📈 PG valuation, revenue & earnings — P/E, P/S, revenue, EPS →

The market has already stopped paying P&G for safety. At $146.23 a share, P&G is worth $339.64 billion1, about 21.2 times its fiscal 2026 net earnings of $16,046 million23. At the end of calendar 2024 it was worth $394.82 billion4, about 26.5 times fiscal 2024 earnings5. The multiple has come down about five points while earnings rose.

Value of $100 invested 30 June 2021, at 30 June 2026 ($)123P&G145S&P 500 Consumer Staples188S&P 500P&G Form 10-K FY2026, performance graph
Safety did not pay.

The shares have also lagged for five years. $100 invested on 30 June 2021 was worth $123 on 30 June 2026, against $188 for the S&P 500 and $145 for the S&P 500 Consumer Staples index6. Owning a steady company in a steady sector did not pay.

What the price now offers is cash. Adjusted free cash flow was $15,835 million in fiscal 20267, about 4.7% of the market value8, and the dividend yield is 2.98%9. P&G returned more than $15 billion in fiscal 202610 and $155 billion over the past ten years11. The stock's beta is 0.3812.

That is the point the market may be missing in both directions. Investors are no longer paying a growth multiple; the forward P/E is 20.9513. A buyer at this price gets roughly a 4.7% free cash yield plus whatever growth P&G manages, which on current guidance is 1% to 3% organically14. That is a fair return for a business this durable, not a bargain and not a trap.

Analysts are more optimistic than the price. The 25 analysts tracked by stockanalysis have an average target of $160.61, about 10% above the share price, with a buy consensus15. The shares traded between $137.62 and $167.25 over the past year16. Enterprise value, including debt, was $364.73 billion, and the shares traded at 6.37 times book value17.

The case would fail if the cash yield fell with the earnings. Adjusted free cash flow productivity is guided to 85% to 90% in fiscal 202718, down from 100%; if it falls further while growth stays near 1%, the shares would be worth less than their price, not more.

References
  1. ReportedAt $146.23 a share, P&G is worth $339.64 billion, about 21.2 times its fiscal 2026 net earnings of $16,046 million.
    Procter & Gamble (PG) market data - $146.23 at the close on 25 September 2026, market cap $339.64B, 52-week range 137.62-167.25, analyst target $160.61. — September 2026 · publ. 25 September 2026 · source ↗
  2. ReportedAt $146.23 a share, P&G is worth $339.64 billion, about 21.2 times its fiscal 2026 net earnings of $16,046 million.
    Procter & Gamble Form 10-K for fiscal 2026 (year ended 30 June 2026) - consolidated statements of earnings, cash flows and financial position, debt and dividends. — FY2026 · publ. 4 August 2026 · source ↗
  3. Moat Explorer calcAt $146.23 a share, P&G is worth $339.64 billion, about 21.2 times its fiscal 2026 net earnings of $16,046 million.
    Moat Explorer calculation from Procter & Gamble's reported figures ($ millions unless stated; fiscal years end 30 June). Net debt: FY2026 11,296 + 22,842 - 9,942 = 24,196; 24,196 / 54,311 = 0.45 times equity; 24,196 / 19,556 = 1.24 years of operating cash flow; debt due within one year 11,296 / (11,296 + 22,842) = 33% of debt; FY2025 9,513 + 24,995 - 9,556 = 24,952; FY2024 7,191 + 25,269 - 9,482 = 22,978. Capital spending 4,409 / 87,032 = 5.1% of net sales. Adjusted free cash flow over dividends 15,835 / 10,232 = 1.55 times. Dividends paid over net earnings attributable: 10,232 / 16,046 = 63.8% (FY2026); 9,872 / 15,974 = 61.8% (FY2025); 9,312 / 14,879 = 62.6% (FY2024). Buybacks 5,028 / 11,009 = 45.7% of the FY2021 peak. Peer market values on 25 September 2026 ($bn): 132.99 + 68.60 + 34.19 + 34.18 + 32.74 + 22.86 + 10.13 = 335.69, against P&G 339.64; P&G / Clorox 339.64 / 10.13 = 33.5 times. P/E: 339.64 / 16.046 = 21.2 (now); 394.82 / 14.879 = 26.5 (December 2024 over FY2024). Free cash flow yield 15,835 / 339,640 = 4.7%. Goodwill plus Gillette brand 41,276 + 12,800 = 54,076; 54,076 / 126,521 = 42.7% of total assets. Segments (five reportable, excluding Corporate): FY2026 sales 16,023 + 6,918 + 12,456 + 30,314 + 20,401 = 86,112; net earnings 2,672 + 1,529 + 2,404 + 5,632 + 3,930 = 16,167; FY2025 net earnings 2,715 + 1,577 + 2,440 + 5,848 + 4,013 = 16,593; 16,167 / 16,593 - 1 = -2.6%. Segment net earnings changes FY2026: Beauty 2,672 / 2,715 - 1 = -1.6%; Grooming 1,529 / 1,577 - 1 = -3.0%; Health Care 2,404 / 2,440 - 1 = -1.5%; Fabric & Home Care 5,632 / 5,848 - 1 = -3.7%; Baby, Feminine & Family Care 3,930 / 4,013 - 1 = -2.1%. Fabric & Home Care share of segment net earnings 5,632 / 16,167 = 34.8%. Pre-tax margins FY2026: Beauty 3,473 / 16,023 = 21.7%; Grooming 1,966 / 6,918 = 28.4%; Health Care 3,163 / 12,456 = 25.4%; Fabric & Home Care 7,290 / 30,314 = 24.0%; Baby, Feminine & Family Care 5,145 / 20,401 = 25.2%. Net margins FY2023: Beauty 3,178 / 15,008 = 21.2%; Health Care 2,125 / 11,226 = 18.9%; Fabric & Home Care 4,828 / 28,371 = 17.0%; Baby, Feminine & Family Care 3,545 / 20,217 = 17.5%. Three-year growth FY2023-FY2026: Health Care sales 12,456 / 11,226 - 1 = 11.0%; Health Care net earnings 2,404 / 2,125 - 1 = 13.1%; Grooming sales 6,918 / 6,419 - 1 = 7.8%; Baby, Feminine & Family Care sales 20,401 / 20,217 - 1 = 0.9%. Segment capital spending over sales FY2026: Grooming 540 / 6,918 = 7.8%; Baby, Feminine & Family Care 1,520 / 20,401 = 7.5%; Health Care 592 / 12,456 = 4.8%; Fabric & Home Care 1,250 / 30,314 = 4.1%; Beauty 415 / 16,023 = 2.6%. Geography FY2026 ($bn): international 45.3 / 87.0 = 52.1%; United States 41.7 / 87.0 = 47.9%. Walmart about 16% x 87,032 = 13,925, about $13.9 billion. Top ten customers less Walmart (rounded percentages): FY2017 35 - 16 = 19; FY2020 38 - 15 = 23; FY2023 40 - 15 = 25; FY2026 43 - 16 = 27. Dividend per share 4.2589 / 4.0763 - 1 = 4.5% (FY2026); 4.0763 / 3.8286 - 1 = 6.5% (FY2025). Market exit charges after tax 1,200 + 131 = 1,331. P&G / Unilever market value 339.64 / 132.99 = 2.6 times. Restructuring charges FY2024-FY2026 659 + 1,114 + 1,230 = 3,003. Gillette write-downs 8.3 + 1.3 = 9.6 billion. Operating margin 19,748 / 87,032 = 22.7% (FY2026); 20,451 / 84,284 = 24.3% (FY2025) - balance sheet, cash returns and valuation. — FY2015-FY2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Procter & Gamble's Forms 10-K, results releases, earnings slides and market data; operands shown in the source line.
  4. ReportedAt the end of calendar 2024 it was worth $394.82 billion, about 26.5 times fiscal 2024 earnings.
    Procter & Gamble market capitalisation history and peer market values (year-end 2015-2025; Unilever, Colgate-Palmolive, Kenvue, Estee Lauder, Kimberly-Clark, Church & Dwight, Clorox on 25 September 2026). — 2015-2026 · publ. September 2026 · source ↗
  5. Moat Explorer calcAt the end of calendar 2024 it was worth $394.82 billion, about 26.5 times fiscal 2024 earnings.
    Moat Explorer calculation from Procter & Gamble's reported figures ($ millions unless stated; fiscal years end 30 June). Net debt: FY2026 11,296 + 22,842 - 9,942 = 24,196; 24,196 / 54,311 = 0.45 times equity; 24,196 / 19,556 = 1.24 years of operating cash flow; debt due within one year 11,296 / (11,296 + 22,842) = 33% of debt; FY2025 9,513 + 24,995 - 9,556 = 24,952; FY2024 7,191 + 25,269 - 9,482 = 22,978. Capital spending 4,409 / 87,032 = 5.1% of net sales. Adjusted free cash flow over dividends 15,835 / 10,232 = 1.55 times. Dividends paid over net earnings attributable: 10,232 / 16,046 = 63.8% (FY2026); 9,872 / 15,974 = 61.8% (FY2025); 9,312 / 14,879 = 62.6% (FY2024). Buybacks 5,028 / 11,009 = 45.7% of the FY2021 peak. Peer market values on 25 September 2026 ($bn): 132.99 + 68.60 + 34.19 + 34.18 + 32.74 + 22.86 + 10.13 = 335.69, against P&G 339.64; P&G / Clorox 339.64 / 10.13 = 33.5 times. P/E: 339.64 / 16.046 = 21.2 (now); 394.82 / 14.879 = 26.5 (December 2024 over FY2024). Free cash flow yield 15,835 / 339,640 = 4.7%. Goodwill plus Gillette brand 41,276 + 12,800 = 54,076; 54,076 / 126,521 = 42.7% of total assets. Segments (five reportable, excluding Corporate): FY2026 sales 16,023 + 6,918 + 12,456 + 30,314 + 20,401 = 86,112; net earnings 2,672 + 1,529 + 2,404 + 5,632 + 3,930 = 16,167; FY2025 net earnings 2,715 + 1,577 + 2,440 + 5,848 + 4,013 = 16,593; 16,167 / 16,593 - 1 = -2.6%. Segment net earnings changes FY2026: Beauty 2,672 / 2,715 - 1 = -1.6%; Grooming 1,529 / 1,577 - 1 = -3.0%; Health Care 2,404 / 2,440 - 1 = -1.5%; Fabric & Home Care 5,632 / 5,848 - 1 = -3.7%; Baby, Feminine & Family Care 3,930 / 4,013 - 1 = -2.1%. Fabric & Home Care share of segment net earnings 5,632 / 16,167 = 34.8%. Pre-tax margins FY2026: Beauty 3,473 / 16,023 = 21.7%; Grooming 1,966 / 6,918 = 28.4%; Health Care 3,163 / 12,456 = 25.4%; Fabric & Home Care 7,290 / 30,314 = 24.0%; Baby, Feminine & Family Care 5,145 / 20,401 = 25.2%. Net margins FY2023: Beauty 3,178 / 15,008 = 21.2%; Health Care 2,125 / 11,226 = 18.9%; Fabric & Home Care 4,828 / 28,371 = 17.0%; Baby, Feminine & Family Care 3,545 / 20,217 = 17.5%. Three-year growth FY2023-FY2026: Health Care sales 12,456 / 11,226 - 1 = 11.0%; Health Care net earnings 2,404 / 2,125 - 1 = 13.1%; Grooming sales 6,918 / 6,419 - 1 = 7.8%; Baby, Feminine & Family Care sales 20,401 / 20,217 - 1 = 0.9%. Segment capital spending over sales FY2026: Grooming 540 / 6,918 = 7.8%; Baby, Feminine & Family Care 1,520 / 20,401 = 7.5%; Health Care 592 / 12,456 = 4.8%; Fabric & Home Care 1,250 / 30,314 = 4.1%; Beauty 415 / 16,023 = 2.6%. Geography FY2026 ($bn): international 45.3 / 87.0 = 52.1%; United States 41.7 / 87.0 = 47.9%. Walmart about 16% x 87,032 = 13,925, about $13.9 billion. Top ten customers less Walmart (rounded percentages): FY2017 35 - 16 = 19; FY2020 38 - 15 = 23; FY2023 40 - 15 = 25; FY2026 43 - 16 = 27. Dividend per share 4.2589 / 4.0763 - 1 = 4.5% (FY2026); 4.0763 / 3.8286 - 1 = 6.5% (FY2025). Market exit charges after tax 1,200 + 131 = 1,331. P&G / Unilever market value 339.64 / 132.99 = 2.6 times. Restructuring charges FY2024-FY2026 659 + 1,114 + 1,230 = 3,003. Gillette write-downs 8.3 + 1.3 = 9.6 billion. Operating margin 19,748 / 87,032 = 22.7% (FY2026); 20,451 / 84,284 = 24.3% (FY2025) - balance sheet, cash returns and valuation. — FY2015-FY2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Procter & Gamble's Forms 10-K, results releases, earnings slides and market data; operands shown in the source line.
  6. Reported$100 invested on 30 June 2021 was worth $123 on 30 June 2026, against $188 for the S&P 500 and $145 for the S&P 500 Consumer Staples index.
    Procter & Gamble Form 10-K for fiscal 2026 (year ended 30 June 2026) - Item 1A risk factors, Item 5 market information and performance graph, and critical accounting estimates (Gillette brand). — FY2026 · publ. 4 August 2026 · source ↗
  7. ReportedAdjusted free cash flow was $15,835 million in fiscal 2026, about 4.7% of the market value, and the dividend yield is 2.98%.
    Procter & Gamble Form 10-K for fiscal 2026 (year ended 30 June 2026) - consolidated statements of earnings, cash flows and financial position, debt and dividends. — FY2026 · publ. 4 August 2026 · source ↗
  8. Moat Explorer calcAdjusted free cash flow was $15,835 million in fiscal 2026, about 4.7% of the market value, and the dividend yield is 2.98%.
    Moat Explorer calculation from Procter & Gamble's reported figures ($ millions unless stated; fiscal years end 30 June). Net debt: FY2026 11,296 + 22,842 - 9,942 = 24,196; 24,196 / 54,311 = 0.45 times equity; 24,196 / 19,556 = 1.24 years of operating cash flow; debt due within one year 11,296 / (11,296 + 22,842) = 33% of debt; FY2025 9,513 + 24,995 - 9,556 = 24,952; FY2024 7,191 + 25,269 - 9,482 = 22,978. Capital spending 4,409 / 87,032 = 5.1% of net sales. Adjusted free cash flow over dividends 15,835 / 10,232 = 1.55 times. Dividends paid over net earnings attributable: 10,232 / 16,046 = 63.8% (FY2026); 9,872 / 15,974 = 61.8% (FY2025); 9,312 / 14,879 = 62.6% (FY2024). Buybacks 5,028 / 11,009 = 45.7% of the FY2021 peak. Peer market values on 25 September 2026 ($bn): 132.99 + 68.60 + 34.19 + 34.18 + 32.74 + 22.86 + 10.13 = 335.69, against P&G 339.64; P&G / Clorox 339.64 / 10.13 = 33.5 times. P/E: 339.64 / 16.046 = 21.2 (now); 394.82 / 14.879 = 26.5 (December 2024 over FY2024). Free cash flow yield 15,835 / 339,640 = 4.7%. Goodwill plus Gillette brand 41,276 + 12,800 = 54,076; 54,076 / 126,521 = 42.7% of total assets. Segments (five reportable, excluding Corporate): FY2026 sales 16,023 + 6,918 + 12,456 + 30,314 + 20,401 = 86,112; net earnings 2,672 + 1,529 + 2,404 + 5,632 + 3,930 = 16,167; FY2025 net earnings 2,715 + 1,577 + 2,440 + 5,848 + 4,013 = 16,593; 16,167 / 16,593 - 1 = -2.6%. Segment net earnings changes FY2026: Beauty 2,672 / 2,715 - 1 = -1.6%; Grooming 1,529 / 1,577 - 1 = -3.0%; Health Care 2,404 / 2,440 - 1 = -1.5%; Fabric & Home Care 5,632 / 5,848 - 1 = -3.7%; Baby, Feminine & Family Care 3,930 / 4,013 - 1 = -2.1%. Fabric & Home Care share of segment net earnings 5,632 / 16,167 = 34.8%. Pre-tax margins FY2026: Beauty 3,473 / 16,023 = 21.7%; Grooming 1,966 / 6,918 = 28.4%; Health Care 3,163 / 12,456 = 25.4%; Fabric & Home Care 7,290 / 30,314 = 24.0%; Baby, Feminine & Family Care 5,145 / 20,401 = 25.2%. Net margins FY2023: Beauty 3,178 / 15,008 = 21.2%; Health Care 2,125 / 11,226 = 18.9%; Fabric & Home Care 4,828 / 28,371 = 17.0%; Baby, Feminine & Family Care 3,545 / 20,217 = 17.5%. Three-year growth FY2023-FY2026: Health Care sales 12,456 / 11,226 - 1 = 11.0%; Health Care net earnings 2,404 / 2,125 - 1 = 13.1%; Grooming sales 6,918 / 6,419 - 1 = 7.8%; Baby, Feminine & Family Care sales 20,401 / 20,217 - 1 = 0.9%. Segment capital spending over sales FY2026: Grooming 540 / 6,918 = 7.8%; Baby, Feminine & Family Care 1,520 / 20,401 = 7.5%; Health Care 592 / 12,456 = 4.8%; Fabric & Home Care 1,250 / 30,314 = 4.1%; Beauty 415 / 16,023 = 2.6%. Geography FY2026 ($bn): international 45.3 / 87.0 = 52.1%; United States 41.7 / 87.0 = 47.9%. Walmart about 16% x 87,032 = 13,925, about $13.9 billion. Top ten customers less Walmart (rounded percentages): FY2017 35 - 16 = 19; FY2020 38 - 15 = 23; FY2023 40 - 15 = 25; FY2026 43 - 16 = 27. Dividend per share 4.2589 / 4.0763 - 1 = 4.5% (FY2026); 4.0763 / 3.8286 - 1 = 6.5% (FY2025). Market exit charges after tax 1,200 + 131 = 1,331. P&G / Unilever market value 339.64 / 132.99 = 2.6 times. Restructuring charges FY2024-FY2026 659 + 1,114 + 1,230 = 3,003. Gillette write-downs 8.3 + 1.3 = 9.6 billion. Operating margin 19,748 / 87,032 = 22.7% (FY2026); 20,451 / 84,284 = 24.3% (FY2025) - balance sheet, cash returns and valuation. — FY2015-FY2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Procter & Gamble's Forms 10-K, results releases, earnings slides and market data; operands shown in the source line.
  9. ReportedAdjusted free cash flow was $15,835 million in fiscal 2026, about 4.7% of the market value, and the dividend yield is 2.98%.
    Procter & Gamble (PG) statistics - trailing P/E 22.08, forward P/E 20.95, P/B 6.37, enterprise value $364.73B, dividend $4.36 (2.98%), beta 0.38. — September 2026 · publ. 25 September 2026 · source ↗
  10. ReportedP&G returned more than $15 billion in fiscal 2026 and $155 billion over the past ten years.
    Procter & Gamble fourth-quarter and fiscal 2026 results release, Form 8-K exhibit 99.1, with fiscal 2027 guidance - quarterly and fiscal-year headline results and cash flow. — Q4 FY2026 · publ. 29 July 2026 · source ↗
  11. ReportedP&G returned more than $15 billion in fiscal 2026 and $155 billion over the past ten years.
    Procter & Gamble fourth-quarter fiscal 2026 earnings slides, Form 8-K exhibit 99.1 - organic sales and core EPS history, share results and fiscal 2027 guidance assumptions. — Q4 FY2026 · publ. 29 July 2026 · source ↗
  12. ReportedThe stock's beta is 0.38.
    Procter & Gamble (PG) statistics - trailing P/E 22.08, forward P/E 20.95, P/B 6.37, enterprise value $364.73B, dividend $4.36 (2.98%), beta 0.38. — September 2026 · publ. 25 September 2026 · source ↗
  13. ReportedInvestors are no longer paying a growth multiple; the forward P/E is 20.95.
    Procter & Gamble (PG) statistics - trailing P/E 22.08, forward P/E 20.95, P/B 6.37, enterprise value $364.73B, dividend $4.36 (2.98%), beta 0.38. — September 2026 · publ. 25 September 2026 · source ↗
  14. ReportedA buyer at this price gets roughly a 4.7% free cash yield plus whatever growth P&G manages, which on current guidance is 1% to 3% organically.
    Procter & Gamble fourth-quarter and fiscal 2026 results release, Form 8-K exhibit 99.1, with fiscal 2027 guidance - fiscal 2027 guidance. — Q4 FY2026 · publ. 29 July 2026 · source ↗
  15. ReportedThe 25 analysts tracked by stockanalysis have an average target of $160.61, about 10% above the share price, with a buy consensus.
    Procter & Gamble (PG) market data - $146.23 at the close on 25 September 2026, market cap $339.64B, 52-week range 137.62-167.25, analyst target $160.61. — September 2026 · publ. 25 September 2026 · source ↗
  16. ReportedThe shares traded between $137.62 and $167.25 over the past year.
    Procter & Gamble (PG) market data - $146.23 at the close on 25 September 2026, market cap $339.64B, 52-week range 137.62-167.25, analyst target $160.61. — September 2026 · publ. 25 September 2026 · source ↗
  17. ReportedEnterprise value, including debt, was $364.73 billion, and the shares traded at 6.37 times book value.
    Procter & Gamble (PG) statistics - trailing P/E 22.08, forward P/E 20.95, P/B 6.37, enterprise value $364.73B, dividend $4.36 (2.98%), beta 0.38. — September 2026 · publ. 25 September 2026 · source ↗
  18. ReportedAdjusted free cash flow productivity is guided to 85% to 90% in fiscal 2027, down from 100%; if it falls further while growth stays near 1%, the shares would be worth less than their price, not more.
    Procter & Gamble fourth-quarter and fiscal 2026 results release, Form 8-K exhibit 99.1, with fiscal 2027 guidance - fiscal 2027 guidance. — Q4 FY2026 · publ. 29 July 2026 · source ↗
Sources
Generated September 26, 2026