KMB - Embedded Expectations Analysis - 2019 07 22
Kimberly-Clark Corporation (KMB:USA) currently trades at historical highs relative to UAFRS-based (Uniform) Earnings, with a 28.8x Uniform P/E. At these levels, markets are pricing fairly bullish expectations for the firm, and management is confident about their growth opportunities, margins, and restructuring efforts.Specifically, management generated an excitement market when discussing their investment in emerging markets and consumer digital sales channels, and they are confident Q1 margins exceeded full year 2018 levels. Additionally, they are confident in their recent innovation efforts in bath tissues and about the progress in their restructuring efforts. Moreover, they are confident that D&E volumes improved in Q1, excluding China and Argentina, and their two most premium diaper products account for more than half of the total Huggies business.
Kimberly-Clark is principally engaged in the manufacturing and marketing of a range of products primarily made from natural or synthetic fibers using technologies in fibers, nonwovens and absorbency. The company is organized into three operating segments: Personal Care, which provides solutions and products such as disposable diapers, training and youth pants, swimpants, baby wipes, feminine and incontinence care products, and other related products; Consumer Tissue, which provides facial and bathroom tissue, paper towels, napkins and related products; and K-C Professional, which provides a range of solutions and supporting products such as wipers, tissue, towels, apparel, soaps and sanitizers.
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