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What Analysts Suggest for Kimberly-Clark Stock?

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Apr. 17 2018, Updated 7:32 a.m. ET

Analysts maintain a “hold” rating

Kimberly-Clark (KMB) is expected to sustain its sales momentum in 1Q18, thanks to anticipated growth in volumes. Moreover, the company’s bottom line is projected to benefit from cost savings and a lower tax rate. However, most analysts prefer to maintain a “hold” rating on Kimberly-Clark stock, given the soft sales environment and near-term margin headwinds.

Kimberly-Clark’s top line is expected to grow at a low-single-digit rate. Benefits from improved volumes are likely to be partially offset lower net selling prices due to increased promotional spending amid higher competitive activity.  A moderating category growth rate and a low birth rate in South Korea remain a drag.

Also, the company’s near-term margins are expected to remain low, given the inflation in raw material prices and higher logistics costs.

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Ratings and target price

Of the 16 analysts covering KMB stock, 11 suggested a “hold” rating. Three analysts recommended a “buy,” and two analysts kept a “sell” rating. The graph shows that analysts have lowered their price targets on KMB in recent months. Analysts maintain a price target of $120.93 per share, which implies an upside of 13.9% to its closing price of $106.16 on April 12.

Analysts also maintain a “hold” recommendation on Procter & Gamble (PG), Colgate-Palmolive (CL), Clorox (CLX), and Church & Dwight (CHD), given the soft sales environment and margin pressure.

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