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.
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.