August 09, 2025 a 07:46 am
PG: Dividend Analysis - The Procter & Gamble Company
The Procter & Gamble Company (PG) stands as a stalwart in the dividends sector, boasting an impressive history of 56 consecutive years of dividend payments. With a current dividend yield of 2.66%, its dividends represent a crucial income stream for many investors. The company's low epsilon in dividend cuts or suspensions demonstrates a strong commitment to returning capital to shareholders.
📊 Overview
The Procter & Gamble Company operates in the consumer staples sector, indicating a stable demand for its products. Below are the main dividend metrics:
| Metric | Value |
|---|---|
| Sector | Consumer Staples |
| Dividend yield | 2.66 % |
| Current dividend per share | 4.02 USD |
| Dividend history | 56 years |
| Last cut or suspension | None |
🗣️ Dividend History
The company's robust history of dividend payments over the past five decades is testament to its stable financial health and commitment to shareholder returns. This consistent track record is crucial for investors focusing on steady income.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 3.12 |
| 2024 | 3.96 |
| 2023 | 3.74 |
| 2022 | 3.61 |
| 2021 | 3.40 |
📈 Dividend Growth
The growth of dividends is a significant factor for investors interested in capital appreciation over income alone. Consistent dividend growth indicates the company's commitment to enhancing shareholder value.
| Time | Growth |
|---|---|
| 3 years | 5.21 % |
| 5 years | 6.03 % |
The average dividend growth is 6.03 % over 5 years. This shows moderate but steady dividend growth.
🔵 Payout Ratio
The payout ratio helps investors understand what portion of earnings and cash flow are being returned to shareholders. It informs about sustainability and potential future increases in dividends.
| Key Figure | Percentage |
|---|---|
| EPS-based | 61.8 % |
| Free cash flow-based | 62.7 % |
With EPS and FCF payout ratios at 61.8% and 62.7% respectively, Procter & Gamble maintains its dividends at sustainable levels without overly relying on earnings, ensuring financial flexibility.
📋 Cashflow & Capital Efficiency
Cash flow and capital efficiency metrics are vital for assessing the company's ability to generate and manage cash effectively, ensuring long-term operational sustainability.
| Metric | 2025 | 2024 | 2023 |
|---|---|---|---|
| Free Cash Flow Yield | 3.59 % | 4.30 % | 3.84 % |
| Earnings Yield | 4.09 % | 3.87 % | 4.08 % |
| CAPEX to Operating Cash Flow | 21.18 % | 16.74 % | 18.17 % |
| Stock-based Compensation to Revenue | 0.56 % | 0.67 % | 0.66 % |
| Free Cash Flow / Operating Cash Flow Ratio | 78.82 % | 83.26 % | 81.82 % |
Procter & Gamble's free cash flow and capital efficiency showcase strong operational management, supporting sustained dividend payouts and potential reinvestments.
📉 Balance Sheet & Leverage Analysis
The balance sheet reveals the company's financial health. Leverage ratios indicate how the company balances debt and equity, critical for understanding risk and financial management.
| Metric | 2025 | 2024 | 2023 |
|---|---|---|---|
| Debt-to-Equity Ratio | N/A | 0.66 | 0.76 |
| Debt-to-Assets Ratio | N/A | 0.27 | 0.29 |
| Debt-to-Capital Ratio | N/A | 0.40 | 0.43 |
| Net Debt to EBITDA | N/A | 1.06 | 1.25 |
| Current Ratio | N/A | 0.73 | 0.63 |
| Quick Ratio | N/A | 0.53 | 0.44 |
| Financial Leverage | N/A | 2.43 | 2.58 |
Procter & Gamble's leverage ratios remain within acceptable ranges, underlining a balanced debt management strategy against equity, which ensures financial stability.
📈 Fundamental Strength & Profitability
Fundamental and profitability measures convey the company's efficiency in generating profits relative to various factors. These are foundational indicators of a company's financial performance.
| Metric | 2025 | 2024 | 2023 |
|---|---|---|---|
| Return on Equity | N/A | 29.59 % | 31.33 % |
| Return on Assets | N/A | 12.16 % | 12.13 % |
| Net Margin | 18.95 % | 17.70 % | 17.87 % |
| EBIT Margin | 25.00 % | 23.42 % | 23.30 % |
| EBITDA Margin | 25.00 % | 26.87 % | 26.55 % |
| Gross Margin | 51.16 % | 51.39 % | 47.86 % |
| R&D to Revenue | 0 % | 0 % | 0 % |
Procter & Gamble maintains robust profitability across key metrics, with high returns on equity and assets. Its consistent margin performance underscores strong operational efficacy and strategic pricing.
📉 Price Development
💹 Dividend Scoring System
| Criteria | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 5 | |
| Dividend growth | 4 | |
| Payout ratio | 4 | |
| Financial stability | 5 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 4 |
Total Score: 34/40
✅ Rating
The Procter & Gamble Company stands as a premier choice for dividend-oriented investors. Considering its exceptional track record of stable and growing dividends, alongside strong financial metrics and sector positioning, PG is a recommended buy for those seeking reliable income and potential capital gain.