Procter & Gamble (PG): Jim Cramer Says – “You Know Never Misses”

In a market increasingly fixated on artificial intelligence and tech-driven disruption, Jim Cramer’s recent remarks on Procter & Gamble (PG) underscore a paradox: a company whose products “never miss” faces headwinds in a world that’s lost patience for slow-and-steady growth. Let’s dissect why PG remains a “must-hold” defensive stock—despite its struggles to excite investors in 2025.

The Numbers: A Resilient Foundation, But Growth Stalls

PG’s first quarter of fiscal 2025 delivered mixed signals. Revenue rose 2% to $21.9 billion, while earnings per share (EPS) surged 34% to $1.88—a stark reminder of PG’s pricing power in a cost-inflated environment.

Yet, the company’s guidance for full-year revenue growth (2%-4%) and EPS growth (10%-12%) suggests caution. Analysts are split: while consensus targets a 12% upside to PG’s current $153 share price, the stock dipped post-earnings as investors rotated into tech stocks.

Tariffs, Trade Wars, and the China Conundrum

Cramer’s skepticism centers on tariff-related risks. PG, a global giant with manufacturing hubs in China, faces dual pressures: rising input costs and geopolitical volatility. While tariff uncertainty has historically allowed PG to raise prices, Cramer warns that U.S.-China trade negotiations remain a “wild card.” The company’s CFO acknowledged that Greater China’s sales, particularly in beauty and oral care, have weakened—a trend expected to linger “for several quarters.”

Meanwhile, supply chain resilience, bolstered by pandemic-era lessons, has kept PG afloat. Yet, the 11% drop in net income year-on-year signals margin pressures. PG’s grooming division (Gillette/Venus) thrived on innovation, but beauty and baby care divisions lagged, with SK-II’s skincare sales plummeting 20%.

The Elephant in the Room: Why PG Can’t Keep Up with Tech

Cramer’s disdain for PG as a “growth play” is clear. While PG’s 3% year-to-date gain outperformed the S&P 500’s decline, its stock underperformed AI-driven peers. The CEO of Hayman Capital, Kyle Bass, summed up the sentiment: “China lies,” and U.S. firms like PG pay the price in currency fluctuations and trade barriers.

Hedge Funds and Analysts: A Split Verdict

PG retains 79 hedge fund holders, but Cramer’s “17th on the list” ranking reflects skepticism. Analysts’ price targets range from $157 to $209, with a $171 consensus. The disconnect? PG’s stable-but-slow trajectory contrasts with AI stocks trading at 5x earnings—versus PG’s P/E of 22. Cramer’s argument? Investors today demand “moats with rocket ships,” not just enduring brands.

The Bottom Line: PG’s Place in a Tech-Driven World

PG’s fiscal 2025 guidance remains achievable, but it hinges on stabilizing China and reigniting beauty sales. Its 82% free cash flow productivity and 28-of-50 market-share gains in key categories are positives. However, the company’s 1% volume decline (excluding pricing) and China’s drag highlight execution risks.

Cramer’s final take? PG is a “moderate buy” for defensive portfolios but lags in a market obsessed with speed. With a 2.5% dividend yield and 34% EPS growth in Q1, PG offers stability—but for aggressive investors, it’s a “never miss” that’s missing the fireworks.

Final Analysis: PG’s 2025 story is one of resilience amid turbulence. While its 2%-4% revenue growth and 10%-12% EPS targets are achievable, its stock’s 1% post-earnings dip signals a broader truth: in a world chasing AI’s next big thing, even a titan like PG struggles to win hearts. Investors seeking safety can hold, but those craving growth? Look elsewhere.