Investors are paying tech stock prices for detergents and diapers.
Procter & Gamble (PG), the maker of Tide, Pampers and Charmin, had its best day since March 2020 on Thursday, adding more than $20 billion in market value. The stock closed at its highest level since February, just below its 2026 high, even as the broader market slipped.
161.59 -2.91 (-1.77%)
At 11:05:18 a.m. EDT. Open market.
P&G gave investors exactly what they wanted: steady growth. Sales rose 4% in the fiscal first quarter, mainly because people bought more of its products. The unit that makes Tide and other P&G cleaning products grew 5%. The company also stuck to its outlook for the full year.
“The consumer is with us,” CFO Andre Schulten told Yahoo Finance on Thursday. In a market seeking security, that was enough.
Investors pay for security
P&G now costs more than some of the biggest names in tech.
Investors often evaluate a stock’s price using the price-to-earnings (P/E) ratio, which divides the stock price by the company’s earnings per share. Using expected earnings for next year, P&G trades at around 22 times. That’s more than Microsoft (MSFT), Meta (META), and Nvidia (NVDA), which trade at less than two-thirds of P&G’s multiple.
Tech stocks have become cheaper because Wall Street is projecting higher future earnings, causing the “E” in P/E to rise and the ratio to fall. The recent sell-off in tech products has caused their stock prices to fall, which has also driven down valuations.
P&G investors are paying a heavy price for a company that expects earnings growth of no more than 3% this year.
So why pay? Investors pay for predictability. People continue to buy toothpaste and toilet paper no matter what the economy is doing, so P&G’s profits rarely surprise on the downside. When markets become unstable, this type of reliability becomes more valuable.
The whole aisle mobilizes
P&G is not alone. Kimberly-Clark (KMB), the maker of Kleenex and Huggies, and Colgate-Palmolive (CL) each gained 4% to 5% on Thursday, and Coca-Cola (KO) closed with a record.
The Consumer Staples Select Sector SPDR Fund (XLP), which holds the household names people shop for every week, just had its best 13-day period since April 2020. Thursday alone was its best day since April 2025. During the same period, the S&P 500 (^GSPC) slipped and chip stocks took a beating.
Falling interest rates also contribute. Commodity stocks are often treated like bonds because they pay stable dividends. When Treasury yields fall, as they did sharply on Thursday, these dividends look more attractive by comparison.
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