Value Analysis of Kimberly-Clark (KMB) Shares

Over the last year, Kimberly-Clark logged a negative performance of -4.7%, with a high of $144.57 and a low of $108.74. During this time, the stock outpaced the S&P 500 index by 5.2%. As of January 2023, the company's 50-day average price was $134.61. Kimberly-Clark Corporation, together with its subsidiaries, manufactures and markets personal care and consumer tissue products worldwide. Based in Dallas, TX, the large-cap Consumer Defensive company has 45,000 full time employees. Kimberly-Clark has provided a 3.4% dividend yield over the last 12 months.

Stable Revenues With Decreasing Reinvestment in the Business:

2019-12-31 2020-12-31 2021-12-31
Revenue (MM) $18,450 $19,140 $19,440
Revenue Growth n/a 3.74% 1.57%
Gross Margins 32.7% 35.6% 30.8%
Gross Margins Growth n/a 8.87% -13.48%
Operating Margins 16.2% 17.0% 13.2%
Operating Margins Growth n/a 4.94% -22.35%
Earnings Per Share $6.24 $6.87 $5.35
EPS Growth n/a 10.1% -22.13%
Free Cash Flow (MM) $1,527 $2,512 $1,723
FCF Growth n/a 64.51% -31.41%
Capital Expenditures (MM) -$1,209 -$1,217 -$1,007
Net Debt / EBITDA 1.94 2.06 2.6

Kimberly-Clark's Valuation Is in Line With Its Sector Averages:

Kimberly-Clark has a trailing twelve month P/E ratio of 25.7, compared to an average of 24.21 for the Consumer Defensive sector. Based on its EPS guidance of 6.46, the company has a forward P/E ratio of 20.9.

The average annual growth rate of the company's historical and projected earnings per share is 3.0%. On this basis, the company's PEG ratio is 8.56, which suggests that it is overpriced.

Kimberly-Clark is also overpriced compared to its book value, since its P/B ratio of 104.3 is higher than the sector average of 4.09. The company's shares are currently 908.7% above their Graham number, which suggests that they are not trading at a fair value in terms of earnings and net assets.

Kimberly-Clark Has an Average Rating of Hold:

There are 17 analysts covering Kimberly-Clark, with target prices ranging from $118 to $150 per share, for an average of $132.66. As of January 2023, the company is trading 1.79% away from its average target price, implying there is an analyst consensus of little upside potential. The average rating for Kimberly-Clark is hold.

With a 2.1% short interest, Kimberly-Clark has an average amount of shares sold short. Institutions own 77.4% of the company's shares, and it has a small amount of insider investors because 0.16% are owned by corporate insiders. Overall, the company's top shareholder is the Vanguard Group, Inc., whose 9% stake in the company is worth around $3,932,830,812.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.