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Procter & Gamble: Assessing the International Opportunity

In today's world, most companies span several regions and sell across the world. As Foolish colleague Morgan Housel notes, less than a third of S&P 500 revenue came from overseas 10 years ago. Today, more than half of the S&P 500's growth comes from overseas.

And that number is growing. The truth is that investors regularly underestimate how much demand comes from abroad. More importantly, for large, multinational corporations that have already established a presence in their home markets, much of their future growth comes from abroad.

With that in mind, today we're looking at Procter & Gamble (NYSE: PG  ) . We'll examine not only where its sales and earnings come from, but how its sales abroad have changed over time.

Where Procter & Gamble's sales were five years ago
Five years ago, Procter & Gamble reported 55% of sales abroad. That’s a number far above the S&P 500 average and a testament to the company’s foresight in growing its brands around the world.

Source: Capital IQ, a division of Standard & Poor's.

Where Procter & Gamble's sales are today
Today, Procter & Gamble’s international march continues. The company now sees 62% of sales in international markets, a figure well ahead of most of its blue-chip peers.

Source: Capital IQ, a division of Standard & Poor's.

Procter & Gamble’s international sales become even more impressive when you look at its growth rate relative to sales in the United States over the past five years.


5-Year Total Sales Growth

United States 19%
International 56%

Source: Capital IQ, a division of Standard & Poor's.

While Procter & Gamble is well established within the United States, its scale and adeptness at managing consumer brands is a competency that can readily be exported around the world. As earnings for U.S. companies continue to skew overseas, Procter & Gamble looks to be a prime beneficiary of the trend.

Competitor checkup
One last point to check is how Procter & Gamble’s footprint compares to some of its peers across the broader consumer staples field:


Geography With Most Sales

Percent of Sales

Procter & Gamble United States 38%
Kimberly Clark (NYSE: KMB  ) United States 50%
Clorox (NYSE: CLX  ) United States 80%
Colgate-Palmolive (NYSE: CL  ) Latin America 27%

Source: Capital IQ, a division of Standard & Poor's.

Out of its peers, Procter & Gamble on average has quite a bit more international exposure. The one notable exception is Colgate-Palmolive, which has extreme sales diversification around the world. Its largest market isn’t even the United States, but rather Latin America.

Keep searching
If you're looking to stay updated on Procter & Gamble, or any other companies listed above, make sure to add them to our free watchlist service, My Watchlist. It's free, and it helps you constantly stay updated on news and analysis on your favorite companies.

Eric Bleeker owns no shares of any companies listed above. The Motley Fool owns shares of Clorox. Motley Fool newsletter services have recommended buying shares of Kimberly Clark, Clorox, and Procter & Gamble. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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10/25/2016 11:55 AM
PG $87.61 Up +3.51 +4.17%
Procter and Gamble CAPS Rating: ****
CL $71.44 Up +0.41 +0.58%
Colgate-Palmolive CAPS Rating: ****
CLX $119.54 Up +0.88 +0.74%
The Clorox Company CAPS Rating: ****
KMB $114.21 Up +0.30 +0.26%
Kimberly-Clark CAPS Rating: ****