The author bought Procter & Gamble (PG) for defensive stability, citing its 70 straight years of dividend increases and a market trading at a historically rich valuation. He weighed Church & Dwight (CHD), whose 4%+ annual organic revenue growth and 8%+ adjusted EPS growth over the past decade produced roughly 9% annualized total returns, but noted it trades at 26 times forward earnings with a yield of about 1.2%. P&G, by contrast, trades below 22 times forward earnings with a yield near 3%. The author estimates P&G could deliver about 8% annualized returns if earnings grow 5% per year with no valuation change, and 9–10% if its valuation recovers. He concludes P&G offers better long-term total return potential without needing fast growth.
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