Is PG a good stock to buy? We came across a bullish thesis on The Procter & Gamble Company on r/investing_discussion by Variant_Invest. In this article, we will summarize the bulls’ thesis on PG. The Procter & Gamble Company’s share was trading at $149.05 as of June 10th. PG’s trailing and forward P/E were 21.79 and 20.92 respectively according to Yahoo Finance.
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The Procter & Gamble Company provides branded consumer packaged goods worldwide. PG is being priced by the market as a slow-growing consumer staple, but that framing underappreciates the structural improvements underway in its business model. Over 2022–2024, the company relied heavily on price increases to defend margins, which successfully protected profitability but obscured underlying volume pressure as consumers traded down to private label alternatives.
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That bear case assumption is now being challenged as volume trends begin to stabilize and organic growth shifts from price-led expansion toward improving unit volumes. A key underappreciated driver is the company’s investment in AI-enabled demand forecasting and supply chain optimization, which has enhanced manufacturing efficiency and improved fixed cost absorption across its global footprint, driving approximately 270 basis points of productivity gains that appear structural rather than cyclical.
Emerging markets exposure, often dismissed due to FX volatility, represents a longer-term tailwind once currency noise is normalized, supporting sustained organic growth. At roughly 23x forward earnings, Procter & Gamble trades at a modest premium to the broader market, but this valuation understates its cash generation quality, 66-plus consecutive years of dividend growth, and strong balance sheet resilience.
It remains a high-quality compounder where improving operational efficiency, stabilizing volumes, and disciplined capital allocation collectively create a favorable long-term rerating opportunity rather than a mature, low-growth staple narrative. Overall, the market continues to misprice the durability of its margins and volume recovery, creating room for multiple expansion as operational improvements compound over time and sentiment shifts back toward quality compounders.
Previously, we covered a bullish thesis on Colgate-Palmolive (CL) by Kontra in October 2024, which highlighted its oral care leadership, emerging markets exposure, pricing power, and high ROIC quality compounder profile. CL’s stock price has depreciated by approximately 10.46% since our coverage. Variant_Invest shares a similar view but emphasizes Procter & Gamble (PG)’s AI-driven supply chain efficiency and volume recovery as key drivers of rerating versus CL’s defensive compounder narrative.
The Procter & Gamble Company is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 78 hedge fund portfolios held PG at the end of the first quarter which was 90 in the previous quarter. While we acknowledge the risk and potential of PG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PG and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
