Procter & Gamble (NYSE:PG), the behemoth consumer goods company that owns some of the world's most recognizable consumer products brands, such as Tide and Pampers, has gone through a remarkable transition in the last few years. At its peak, the conglomerate controlled nearly 170 brands, but has since cut nearly two-thirds of those and now has around 65 of its most profitable brands with higher earnings growth potential. The company still has some kinks to work out in this transition period, and 2017 will be a chance for investors to see just how well the turnaround plan is working. Will it be Procter & Gamble's best year yet? Let's take a look.

Image source: Procter and Gamble.

P&G lite

P&G first implemented its divestment strategy in 2014, and started to sell off some big assets, such as its Duracell battery line, as well as big portions of product segments, like the 41 beauty brands it sold in September that took P&G almost completely out of the beauty product market. The 65 brands that P&G has left over made up around 95% of P&G's profits before the divestment plan started.

The billions of dollars received for the sold brands should help the company double down on those remaining brands to focus and grow each one's profitability to higher levels than the company was able to in its former bloated state. The final earnings impact of the beauty brands sales should be laid out in the coming fiscal year Q2 earnings release in January, and that seems to be the last of the planned brand sales.

Analysts are going lite, too

While the recent earnings results are impressive, analysts are pointing out that the earnings bump from the brand sales don't make up for the fact that organic sales growth is still slow -- up just 3% in the recent fiscal Q1, year over year, which is up slightly from the 2% growth for full year 2016. Sales growth looks better when adjusted for currency fluctuations as the dollar has strengthened, which makes P&G's international sales look weaker, as international sales make up 56% of P&G's total, but the reality is that the dollar continues to rise, which could make those reported sales continue to look weaker.

Because of those less-impressive underlying numbers, analysts at Deutsche BankStifel, and SunTrust have all downgraded Procter & Gamble in December (though, to be fair, this follows a fair number of upgrades in the months prior). Those bearish analysts seem to be concerned that currency headwinds, slow organic sales growth, and more expensive input costs that will lower P&G's gross margin will mean an uncertain year ahead for P&G.

Could 2017 be P&G's best year yet?

2017 probably won't be Procter & Gamble's best year yet, at least not by stock price growth compared to its most successful year in recent history -- in 2014 P&G's stock rose 15%. For fiscal year 2017, P&G management has forecast organic sales to grow around 2% companywide, with net sales up only 1%. The following two quarters of calendar year 2017 aren't likely to be much higher in terms of underlying sales growth. It's unlikely that 1%-2% growth, without any new major news, such as the 2014 announcement to cut more than half of its brands, will lead investors and analysts to reward the company with double-digit share-price growth again.

However, P&G could still be a good investment. Even though this company has faced stagnating sales in recent quarters, its relative market strength makes it look like a solid play as it focuses on growing only those brands that will lead to renewed long-term profit growth. Aside from growing earnings in the short- and long-term due to brand sales and income growth in its 65 best brands, the company has also been a proven dividend steward with consistent moves to increase its payout each of the past 60 years. The company's most recent boost in April moved its dividend to $2.68 annually, which makes for a 3.1% yield at the current share price.

The shares are not exactly cheap, trading at around 23 times earnings, which is in line with this expensive environment as the S&P average P/E is around 24. Still, P&G has been around for more than 100 years, and its history of rewarding shareholders who stick with the company over the long term shows no signs of stopping for investors that are willing to wait. P&G is also relatively stable during market downturns, which along with its slow growth and healthy dividend, could make it an important part of a diversified portfolio -- even if 2017 isn't its best year yet. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.