Stock of the Day

April 27, 2020

Kimberly-Clark (KMB)

$135.30
-$3.13 (-2.3%)
Market Cap: $44.89B

About Kimberly-Clark

Kimberly-Clark Corporation, together with its subsidiaries, manufactures and markets personal care and consumer tissue products in the United States. It operates through three segments: Personal Care, Consumer Tissue, and K-C Professional. The company's Personal Care segment offers disposable diapers, training and youth pants, swimpants, baby wipes, feminine and incontinence care products, reusable underwear, and other related products under the Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Sweety, Kotex, U by Kotex, Intimus, Thinx, Poise, Depend, Plenitud, Softex, and other brand names. Its Consumer Tissue segment provides facial and bathroom tissues, paper towels, napkins, and related products under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Neve, and other brand names. The company's K-C Professional segment offers wipers, tissues, towels, apparel, personal protective equipment, soaps, and sanitizers under the Kleenex, Scott, WypAll, Kimtech, and KleenGuard brands. It also sells household use products directly to supermarkets, mass merchandisers, drugstores, warehouse clubs, variety and department stores, and other retail outlets, as well as through other distributors and e-commerce; and away-from-home use products directly to distributors, manufacturing, lodging, office building, food service, and public facilities, as well as through e-commerce. Kimberly-Clark Corporation was founded in 1872 and is headquartered in Dallas, Texas.

Kimberly-Clark Bull Case

Here are some ways that investors could benefit from investing in Kimberly-Clark Co.:

  • The company recently reported earnings per share (EPS) of $1.93, exceeding analysts' expectations, which indicates strong financial performance and potential for growth.
  • Kimberly-Clark Co. has a robust net margin of approximately 12.69%, suggesting effective cost management and profitability, which can lead to higher returns for investors.
  • The current stock price is around $129.70, which may present a favorable entry point for investors looking to capitalize on potential future growth.
  • The company has a solid dividend yield of about 3.60%, providing a steady income stream for investors, which is particularly attractive in uncertain market conditions.
  • Analysts forecast an average EPS of 7.5 for the current fiscal year, indicating positive growth expectations and confidence in the company's future performance.

Kimberly-Clark Bear Case

Investors should be bearish about investing in Kimberly-Clark Co. for these reasons:

  • The company reported revenue of $4.84 billion, which fell short of analysts' expectations, suggesting potential challenges in meeting market demand.
  • Kimberly-Clark Co. has experienced a decrease in EPS compared to the same period last year, which may raise concerns about its growth trajectory.
  • The dividend payout ratio is currently at 68.66%, indicating that a significant portion of earnings is being distributed as dividends, which could limit reinvestment in the business.
  • Recent analyst downgrades and price target reductions may signal a lack of confidence in the stock's short-term performance, which could deter potential investors.
  • Insider activity shows a decrease in ownership by insiders, which might suggest a lack of confidence in the company's future prospects from those who are most familiar with its operations.
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