KMB - Embedded Expectations Analysis - 2021 03 16
Kimberly-Clark Corporation (KMB:USA) currently trades near recent averages relative to UAFRS-based (Uniform) earnings, with a 23.7x Uniform P/E. At these levels, the market is pricing in expectations for Uniform ROA to remain stable, but management may have concerns about their personal care business, tissue demand, and their online channel market shareSpecifically, management may lack confidence in their ability to further gain market share for Kleenex and across online channels, sustain strong momentum for their personal care business, and improve the efficiency of their advertising and supply chain through recent investments. Furthermore, they may have concerns about the sustainability of tissue demand, consistent declines in birth rates across markets, and the sustainability of consumer stockpiling behavior. Finally, they may lack confidence in their ability to sustain volume growth in Africa, and they may have concerns about the continued impact of the pandemic on their 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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