Do You Think The Procter & Gamble Company (PG) is a Recession-Proof Stock?

Rowan Street Capital, an investment management company, released its 2022 yearly update. A copy of the same can be downloaded here. The fund declined -61% in 2022, due to the decline of growth stocks in the year as the fund’s portfolio is dominated by growth companies. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.

Rowan Street Capital highlighted stocks like The Procter & Gamble Company (NYSE:PG) in its Q4 2022 investor letter. Headquartered in Cincinnati, Ohio, The Procter & Gamble Company (NYSE:PG) is a global consumer goods producer. On January 10, 2023, The Procter & Gamble Company (NYSE:PG) stock closed at $151.89 per share. One-month return of The Procter & Gamble Company (NYSE:PG) was -0.62%, and its shares lost 4.48% of their value over the last 52 weeks. The Procter & Gamble Company (NYSE:PG) has a market capitalization of $359.934 billion.

Rowan Street Capital made the following comment about The Procter & Gamble Company (NYSE:PG) in its Q4 2022 investor letter:

“Let’s look at The Procter & Gamble Company (NYSE:PG). Dividend yield is 2.4%. Earnings are forecasted to grow at 5.9%, and its current earnings multiple is at 25x. Now, lets say over the next 3-5 years the market loses interest in the “safe”, mature companies that grow at anemic rates and gets an appetite for growth again. It’s very unlikely that Mr. Market will be paying 25x for 5.9% earnings growth. Lets assume that multiple declines to the market average of 18x — that would be ~6.9% drag per year on the total expected return over next 3-5 years. If we get 2.4% (dividend) + 5.9% (earnings growth) – 6.9% (decrease in earnings multiple) = 1.4% (annual return we can expect on average from this stock).”

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The Procter & Gamble Company (NYSE:PG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 69 hedge fund portfolios held The Procter & Gamble Company (NYSE:PG) at the end of the third quarter, which was 71 in the previous quarter.

We discussed The Procter & Gamble Company (NYSE:PG) in another article and shared the list of biggest non-tech companies in the world by market cap. In addition, please check out our hedge fund investor letters Q4 2022 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.