Procter & Gamble Co

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PG : NYSE : Consumer Goods
$87.58 | %
Today's Range: 87.17 - 88.50
Avg. Daily Volume: 7,261,200
08/26/16 - 4:00 PM ET

Financial Analysis


PROCTER & GAMBLE CO's gross profit margin for the fourth quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. PROCTER & GAMBLE CO has weak liquidity. Currently, the Quick Ratio is 0.58 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has decreased by 8.13% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q4 FY16 Q4 FY15
Net Sales ($mil)16102.016553.0
EBITDA ($mil)3695.04215.0
EBIT ($mil)2856.03407.0
Net Income ($mil)1951.0521.0


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)13348.011612.0
Total Assets ($mil)127136.0129495.0
Total Debt ($mil)30598.030350.0
Equity ($mil)57341.062419.0


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin54.8553.28
EBITDA Margin22.9425.46
Operating Margin17.7420.58
Sales Turnover0.510.55
Return on Assets8.265.43
Return on Equity16.8712.68
Debt Q4 FY16 Q4 FY15
Current Ratio1.11.0
Debt/Capital0.350.33
Interest Expense150.0148.0
Interest Coverage19.0423.02


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)2668.072714.57
Div / share0.670.66
EPS0.710.15
Book value / share21.4922.99
Institutional Own % n/a n/a
Avg Daily Volume7135697.08218303.0

Valuation


BUY. PROCTER & GAMBLE CO's P/E ratio indicates a discount compared to an average of 28.99 for the Household Products industry and a value on par with the S&P 500 average of 25.25. Conducting a second comparison, its price-to-book ratio of 4.04 indicates a premium versus the S&P 500 average of 2.83 and a significant discount versus the industry average of 39.55. The current price-to-sales ratio is well above the S&P 500 average and above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, PROCTER & GAMBLE CO proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
PG 24.89 Peers 28.99   PG 15.01 Peers 16.52

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

PG is trading at a discount to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

PG is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
PG 20.68 Peers 23.32   PG 2.35 Peers 1.73

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

PG is trading at a valuation on par with its peers.

 

Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

PG trades at a significant premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
PG 4.04 Peers 39.55   PG 23.75 Peers 36.97

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

PG is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, PG is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
PG 3.55 Peers 3.44   PG -7.71 Peers -4.89

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

PG is trading at a valuation on par with its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

PG significantly trails its peers on the basis of sales growth

 

 

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