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Kimberly-Clark: Analysts’ Recommendations and Target Price

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Downgrades

A few Wall Street analysts downgraded Kimberly-Clark (KMB) stock before its third-quarter results. On October 10, Deutsche Bank downgraded Kimberly-Clark stock to “sell” from “hold” and lowered the target price to $99 from $108. On October 8, Goldman Sachs downgraded Kimberly-Clark stock to “neutral” from “buy” and reduced the target price by $1 to $119.

Analysts expect Kimberly-Clark to continue to disappoint on the sales and margins front. The company’s earnings are expected to grow. However, the growth rate isn’t expected to be impressive. Kimberly-Clark’s top line is expected to decline during the third quarter, which reflects weak volumes and pricing. Higher cost pressure and negative currency rates are expected to hurt the company’s margins and EPS growth rate.

The lower effective tax rate, share buybacks, and lower interest costs are expected to support Kimberly-Clark’s earnings.

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Ratings and target price

Most Wall Street analysts maintain a “neutral” recommendation on Kimberly-Clark stock. Among the 18 analysts covering the stock, 13 analysts recommended a “hold,” while five recommended a “sell.” Analysts have a consensus target price of $105.88 per share on Kimberly-Clark stock, which indicates a downside of 3.0% based on its closing price of $109.14 on October 12.

Analysts also maintain a “neutral” outlook on Kimberly-Clark’s peers including Procter & Gamble (PG), Colgate-Palmolive (CL), Church & Dwight (CHD), and Clorox (CLX).

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