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Kimberly-Clark Stock: Why Analysts Expect It to Fall

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Jun. 14 2019, Published 7:06 p.m. ET

Most analysts recommend “hold”

Kimberly-Clark (KMB) had risen 20.5% this year as of yesterday, thanks to the company’s better-than-expected quarterly performance, organic sales growth, and moderating margin contraction. However, analysts seem to be hesitant as adverse currency rates, soft volumes, competition, and higher raw material costs could continue to restrict its sales and earnings. Given KMB’s recent uptrend and analysts’ expectation of low-single digit EPS growth, its valuation looks unattractive.

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Ratings and target price

Of the 17 analysts covering Kimberly-Clark stock, ten recommend “hold,” four recommend “sell,” and three recommend “buy.” Their average target of $123.07 for KMB stock implies a 10.4% downside based on its June 13 closing price of $137.32. Analysts also mostly recommend “hold” for consumer packaged goods stocks Church & Dwight (CHD), Colgate-Palmolive (CL), Clorox (CLX), and Procter & Gamble (PG).

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