I repeat the fact that value is always relative, but let's assume PG is "overvalued". It's true that the P/E is at the upper end of its range. But it's also true that a high P/E is not predictive of lower stock prices. A high P/E is simply predictive of lower returns going forward. Think of it as borrowing capital appreciation from the future.
To see this at work, look at a chart for JNJ. It entered the millennium valued at 40x earnings. Despite the high PE, it spent the next 12 years or so rangebound, except during the market crashes of '00 and '08. Earnings eventually caught up with price, and then it broke out to new highs. Despite its "overvaluation" there was no big crash, and no big correction. On the contrary, it actually BEAT THE S&P 500.
I estimate fair value for PG is around $75, but at $80 PG is hardly a"sell" and definitely not a "short".
Be Warren Buffett. Invest in great companies at reasonable prices. A shareholder is a fractional owner of the business. Asia is rising. They will need mucho P&G products to clean up the mess of the falling Western world.
I'm going off on a tangent here, but Asia has deep problems of their own. Having visited a few developing nations, I would be shocked to see their standard of living eclipse our own in our lifetimes. This may sound corny or cliche, but despite recent troubles America is still a pretty amazing place, and I think our best days lie ahead.
I agree fair value is $75 thats why I sold at $76....Im short it for a trade becasue its extended and overvalued. Fundamentaly PG is doing great in five years it will probably be worth $100 a share....