Procter & Gamble (PG) Shares Plunge 1.87% on Restructuring, Tariff Hurdles, and Leadership Transition

The Procter & Gamble (PG) share price fell to its lowest level since January 2024 on Friday, with an intraday decline of 0.75%. The stock has now dropped 1.87% over the past three trading days, extending a downward trend as investors weigh a mix of strategic shifts, cost pressures, and leadership transitions.

Recent restructuring efforts and leadership changes are amplifying uncertainty. The company announced plans to cut 7,000 office jobs globally, streamlining operations by scaling back product lines in Asia and discontinuing underperforming divisions. While such measures aim to reduce overhead, their execution remains unclear, and historical precedents like the 2008 job cuts highlight the potential for short-term volatility. Concurrently, CEO Jon Moeller is set to step down in early 2026, with Shailesh Jejurikar, a 35-year company veteran, succeeding him. Jejurikar’s appointment underscores a focus on core, high-margin segments but raises questions about how the new leadership will balance efficiency with growth.

External pressures are further weighing on sentiment. U.S. tariffs are expected to add $1 billion in pre-tax costs for the upcoming fiscal year, prompting PG to implement modest price hikes for 25% of its products, primarily in North America. While the company’s brand strength in household and personal care products offers pricing resilience, consumer pushback in price-sensitive markets could constrain revenue gains. Meanwhile, legal challenges loom, with class-action lawsuits alleging deceptive marketing practices in decongestant products. These cases, alongside regulatory scrutiny risks, could erode trust and distract management during a critical restructuring phase.

Investor confidence remains divided. Analysts have issued mixed ratings, with some downgrading the stock to “Hold” due to concerns about its high valuation and muted earnings growth. Institutional activity reflects this duality: entities like AE Wealth Management have added shares, while others have reduced stakes. Insider selling, including a $1.78 million transaction by the COO in September, has also fueled skepticism. PG’s dividend strategy—prioritizing shareholder returns with a 61% payout ratio—appeals to income-focused investors but limits reinvestment in growth initiatives, a trade-off that may struggle to satisfy long-term capital seekers in a market favoring expansion over yield.

Despite these headwinds, PG’s strong return on equity (31% as of June 2025) and dominant market position in essential consumer goods provide a foundation for stability. The company’s ability to navigate restructuring, absorb tariff costs, and execute Jejurikar’s strategic vision will be critical in determining whether the current selloff reflects overcorrection or a more durable shift in investor sentiment.