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Kimberly-Clark’s Quarterly Dividend Rose to $0.92

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Price movement of Kimberly-Clark

Kimberly-Clark (KMB) has a market cap of $45.9 billion. KMB fell by 2.7% to close at $126.42 per share as of February 11, 2016. The price movements on weekly, monthly, and year-to-date (or YTD) bases are -1.8%, 0.23%, and -0.69%, respectively.

At times, the stock has broken the support of all moving day averages. Currently, KMB is trading 0.50% below its 20-day moving average, 0.76% above its 50-day moving average, and 10.7% above its 200-day moving average.

The PowerShares DWA Consumer Staples Momentum ETF (PSL) invests 3.0% of its holdings in Kimberly-Clark. The ETF tracks an index of US consumer cyclical firms selected and weighted by price momentum. The YTD price movement of PSL is -6.6% as of February 10, 2016.

The PowerShares High Yield Equity Dividend Achievers ETF (PEY) invests 1.8% of its holdings in Kimberly-Clark. The ETF aims to track a yield-weighted index of US companies that have increased their annual dividend for at least ten consecutive years.

The market cap of Kimberly-Clark’s competitors are as follows:

  • Procter & Gamble (PG) — $216.1 billion
  • Edgewell Personal Care (EPC) — $4.3 billion
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Kimberly-Clark raised dividend

Kimberly-Clark has increased its quarterly dividend to $0.92 per share, a rise of 4.5%. The dividend will be paid on April 4, 2016, to shareholders of record on March 4, 2016. It has increased the dividend for the 44th consecutive year.

Performance of Kimberly-Clark in fiscal 4Q15 and fiscal 2015

Kimberly-Clark reported fiscal 4Q15 net sales of $4,539.0 million, a fall of 6.0% compared to net sales of $4,828.0 million in fiscal 4Q14. Sales of personal care, consumer tissue, and Kimberly-Clark professional segments fell by 4.4%, 6.2%, and 9.5%, respectively, in fiscal 4Q15 compared to sales in fiscal 4Q14.

Its net income and EPS (earnings per share) rose to $333.0 million and $0.91, respectively, in fiscal 4Q15, compared to -$83.0 million and -$0.22, respectively, in fiscal 4Q14.

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Fiscal 2015 results

In fiscal 2015, KMB reported net sales of $18,591.0 million, a fall of 5.7% YoY (year-over-year). The company’s cost of products sold as a percentage of net sales and operating profit fell by 3.0% and 36.0%, respectively, in fiscal 2015.

Its net income and EPS fell to $1,013.0 million and $2.77, respectively, in fiscal 2015, compared to $1,526.0 million and $4.04, respectively, in fiscal 2014.

Its cash and cash equivalents fell by 21.5%, and inventories rose by 0.90% in fiscal 2015. Its current ratio fell to 0.85 in fiscal 2015 compared to 0.89 in fiscal 2014.

At the end of 2015, the company deconsolidated the assets and liabilities of its Venezuelan business from its balance sheet. Now it will use a cost method of accounting for operations in Venezuela. It reported the after-tax charge of $102 million in fiscal 4Q15 due to a slowness in foreign exchange and challenging conditions in Venezuela. It will continue to manufacture and sell products in Venezuela when the foreign exchange is received to pay for imports of raw materials and finished goods.

The PE (price-to-earnings) and PS (price-to-sales) ratios of Kimberly-Clark are 45.8x and 2.5x, respectively, as of February 11, 2016.

Projection

The company has made the following projections for fiscal 2016:

  • net sales down 3% compared to fiscal 2015
  • adjusted operating profit growth in the range of 2% to 5%
  • capital spending in the range of $950 million to $1,050 million
  • adjusted effective tax rate in the range of 30.5% to 32.5%
  • adjusted EPS in the range of $5.95 to $6.15
  • share repurchases in the range of $600 million to $900 million, subject to market conditions.
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