The P/E ratio of 17.16 is slightly higher than the market P/E of 14.60. The dividend rate is 3.37%, which is about 50% of projected earnings and higher than the market's dividend rate of 2.3% The dividend has been raised steadily and is expected to grow between 8% and 10% over the next five years. The balance sheet gets an A++ financial strength rating.
Although the sales and earnings growth projections are not aggressive, the stock has a long history of ever-increasing revenue and earnings. Management has promised to add stockholder value through a $4 billion share buyback program. About 1/3 of the sales are in emerging markets countries, so big growth cannot come without a worldwide economic recovery.
The staff of TheStreet rates the stock a B. Wall Street brokerage analysts have released six strong buy, six buy, 12 hold and one underperform recommendation to there clients. They expect total annual return to investors will be in the 13% to 17% range over the next five years.Individual investor interest from the readers of Motley Fool is high where 7,697 readers gave a 97% vote that the stock will beat the market. Short interest grew from about 14 million shares in March to a high of 20 million shares in mid-June but has retreated to about 18 million shares recently. Comparison to its peers: While Procter & Gamble was up 6% in the past year, Colgate-Palmolive (CL) was up 20%, Kimberly-Clark (KMB) was up 24% and Clorox (CLX) was up 9%. Colgate-Palmolive was rated A+ by TheStreet staff. Analysts project revenue will grow 2.7% this year and another 4.4% next year. Earnings are estimated to be up 6.4% this year and 9.5% next year. Kimberly-Clark was rated A+ by TheStreet staff. Revenue is projected to be up 1% this year and 2.7% next year. Earnings increases are estimated to be 7.9% this year and 7.3% next year. Clorox is rated a B- by TheStreet staff. Revenue is projected to be up 3.4% this year and 3.3% next year. Earnings could be up 4.6% this year and 7.9% next year.