KMB Stock: Analysts’ Recommendations and Target Price



Analysts remain on sidelines

Kimberly-Clark (KMB) failed to impress with its fourth-quarter performance. Its healthy performance on the organic sales front was positive. However, weak margins and the lower EPS growth rate didn’t sit well with investors. Following its fourth-quarter results, J.P. Morgan lowered its target price on Kimberly-Clark stock to $120 per share from $129.

Kimberly-Clark’s top line is projected to remain weak in 2019 as currency volatility is expected to take a toll on it. Organic sales are projected to improve, driven by higher pricing. However, increased pricing amid heightened competition could hurt volumes. Meanwhile, business remains weak in China, which is a concern.

Its margins could continue to take a hit from higher commodity costs. However, increased pricing and cost-saving measures are expected to support margins. Kimberly-Clark’s bottom line faces significant headwinds from the higher tax rate in 2019, which could result in lower EPS.

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Rating and consensus target price

Of the 18 analysts covering the stock, 12 analysts recommend a “hold,” five analysts suggest a “sell,” and one analyst has a “buy” rating on KMB stock. Meanwhile, analysts have a consensus target price of $106.56 per share on KMB, which implies a downside of 5.0% based on its closing price of $112.15 on January 23.

Analysts also maintain a neutral outlook on the stocks of Procter & Gamble (PG), Clorox (CLX), Colgate-Palmolive (CL), and Church & Dwight (CHD).


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