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Procter and Gamble: A Buy or Sell?

         Producing the necessities of the bathroom and other everyday items, Procter and Gamble (PG) continues to be an excellent investment in all areas. With marginal competition and loyalty from its workers, PG will provide investors with an excellent opportunity to achieve high capital gains.
         Elusive to negativity, Procter and Gamble continues to follow its high respectability with its amazing fundamentals presented each quarter. Over the last four earning reports PG had beat expectations in terms of EPS all four times and beat revenue estimates each time as well. The laud extends to the PG’s excellent margins in terms of revenue, profit, and operating margins, and especially there should be high praise for PG doubling the amount of total assets over one year for this flourishing company. The P/E remains solid at around 23 which is supported for some reluctant investors with a great dividend payout of 1.24.
         PG also has the reputation of providing long term investors with a steady persistent growth without too much volatility. While PG did falter a bit during late 2000 to 2001, the situation remained dubious for all equities of all sectors. However, unlike some of these other equities, PG remained resilient and in a matter of a few years returned back to its record high of near 65 points: an almost 100% increase over about five years.
         With an inevitable recession approaching in the coming months, stocks like PG, equities that rise during times of economic downturns, tend to be the best acquisition for investors wagering this storm. While some investors may argue that PG is at an all time high and may be reluctant to purchase shares at such a price, I would make the argument that because of the economic problems the country is facing, the excellent fundamentals that PG provides, and the incredible steady nature which is advocated for long term investors, PG should have no problem being bought by big institutions in the future. Such a sentiment will do nothing but increase capital gains for consumers who hold or even buy PG at such a high price.

-Dennis Biray
September 17th, 2006

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