Procter & Gamble: A Cash Cow That Is Still A Sell

Summary

• Procter & Gamble remains a cash-generative, high-margin enterprise, but I am bearish due to its modest growth outlook and overvaluation.
• PG faces significant headwinds: slowing US/global demand, tariff-related cost increases over $1 billion, and competitive pressures leading to market share losses.
• Despite an 'A+' profitability grade and robust cash flow, PG trades at a 21x P/E, almost 30% above the sector median, unsupported by its sluggish growth profile.
• I assign a sell rating, estimating intrinsic value at $126 versus the current ~$146; downside risk, despite strong segment performance and earnings history, is a key reason.