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Colgate-Palmolive and Unilever Upending Procter & Gamble

Stocks in this article: UL CL PG PF

NEW YORK ( TheStreet) -- Following the fate of consumer goods superstars Procter & Gamble (PG) and Colgate-Palmolive (CL) can be like watching a hit TV series.

Just when you think you've figured out what's going to happen next, the writers throw in a new plot twist to the plot.

PG and its future prospects don't seem to get the respect they deserve. And just when you think you've heard it all...

We recently learned that PG's former CEO, Bob McDonald, received compensation during his final full year at the world's largest consumer products maker of nearly $16 million, up 5% from the last year.

Then McDonald's retirement was suddenly announced in May as PG was under the gun to improve its bottom-line results. He was replaced by his predecessor, A.G. Lafley, who was given a prorated compensation deal of $2 million for the five weeks he served at the end of the company's fiscal year, according to a filing with the Securities and Exchange Commission.

But who cares when P&G, Colgate and European-based Unilever (UN) are seeing their shares sold off like bad apples? PG shares recently plunged to $77.33 before recovering a bit to around $78.

Yet, PG is still selling at a rich multiple. Shares have dropped 3.5% since the intraday high on my birthday, Aug. 21, (it feels so good to be 39 once again, but I digress). PG's PE ratio is still around 20. Below $78 a share the relative strength index (RSI) dips below 30, a technical oversold sign as well.

Investors wonder why PG's pint-size rival, Colgate-Palmolive, is afforded a current PE ratio of over 24 while PG only trades at slightly more than a PE of 20. PG, with a market cap of over $215 billion offers investors a current dividend yield-to-price of over 3%.

CL's market cap weighs in at around $54 billion and its current $1.36 annual dividend equates to a yield of only 2.34% when the price is at $58.22. Even when looking at the future (one-year) PE, CL sports almost a 19 and PG gets slightly less than 17. UN has a $109 billion market cap at a PE of 18.

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