As a $181 billion consumer goods giant with brands found in practically every home, it's no surprise that there's plenty of retail and institutional interest in Procter & Gamble
Turns out, the view is mostly bullish. Let's have a look at a few of the key sentiment drivers.
1. Analyst opinion
Analysts are bullish on Procter & Gamble. Data from Yahoo! Finance captures their collective feeling:
Eleven analysts have a "strong buy" rating, with an additional eight "buys" compared with just six "holds." There are no "sell" ratings. For purposes of this exercise, we'll classify analyst opinion as bullish.
2. Insider buying
Next we'll look at insider buying and selling. Over the past year, P&G insiders have sold $10 million worth of their company stock. During the same time period, insiders bought about $500,000. (Data from Form4Oracle.)
These amounts aren't meaningful relative to P&G's market cap. And while insiders sell stock for a whole host of reasons -- to pay for a house or tuition, to diversify assets, and so forth -- it is a good sign to see some insider buying. For P&G, we'll classify insider buying/selling as neither bullish nor bearish.
3. Guru buying
Next, we'll look at "guru" ownership of the stock. According to GuruFocus, gurus have been selling and buying in the past two quarters. Don Yacktman added to his stake in the quarter ended Dec. 31, while Richard Snow and John Hussman reduced their stakes. In the quarter ended Sept. 30, George Soros and Jean-Marie Eveillard sold out of their P&G positions, but Yacktman and Mario Gabelli were buying P&G shares.
Gurus have been adding and selling Procter & Gamble at similar rates, so we'll call the guru trend neutral.
4. Retail investor community sentiment
For retail investor community sentiment, I turn to Motley Fool CAPS, our proprietary stock rating system. CAPS generates ratings on a one- to five-star scale, with five stars as the highest ranking, indicating that the Fool community believes in a stock's future. Procter & Gamble has a solid four-star rating.
Next we'll look at whether short-sellers are circling the stock. There are 24.4 million P&G shares sold short, according to Capital IQ. As a percentage of shares outstanding, that's a short interest of 0.9%. That's not very high -- a struggling operator like Barnes & Noble has a short interest of 13.3% right now -- and so for determining sentiment, we'll take it as a good sign.
6. Does Buffett own it?
This is the "cherry on top" test, and in P&G's case, it's a big yes: Berkshire Hathaway owns nearly 3% of P&G. Buffett was a large shareholder in Gillette, which P&G acquired in 2005.
Adding it up
P&G is liked by analysts and the CAPS community, and short-sellers aren't betting against the stock in a significant way. Guru ownership is mixed, as is the insider buying/selling picture. The company passes our final test -- Buffett's possible ownership -- as Berkshire is a large shareholder. Add it all up and P&G comes out with a "mostly bullish" consensus sentiment.
Of course, you can't base an investment philosophy on who likes the stock you like, and a consensus opinion can sometimes be a scary thing. Quoting Buffett: "A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful." There doesn't seem to be a sense of either fear or greed circling P&G right now, though.
The purpose of this series of articles isn't to make a definitive buy-or-sell call on P&G. Rather, by looking at a stock's sentiment, the goal is to help you place your own opinion of it in a broader context.
One final thing: If you want to keep tabs on P&G's movements, and for more analysis on the company, make sure you add it to your Watchlist.
Fool.com managing editor Brian Richards does not own shares of any companies mentioned. Berkshire Hathaway is a Motley Fool Inside Value and Motley Fool Stock Advisor recommendation. P&G is a Motley Fool Income Investor choice. The Fool owns shares of Berkshire Hathaway and has a disclosure policy.