Kimberly Clark develops, manufactures and markets personal care products (Huggies, Pull Ups, Little Swimmers, Goodnights, Kotex, Depends, Kleenex, Scott, Cottonelle tissue and Viva paper towels).
KMB has grown its profits and dividends at a 4-9% annual rate over the past 10 years earning an amazing 30%+ rate of return on equity. As with many of our companies, Kimberly has had a rough go of it in the last five years as customers ‘traded down’ to generic brands. However, the company is seeing improvement in its bottom line which should continue as a result of:
(1) significant cost cutting as well as better supply chain management,
(2) expansion into emerging markets,
(3) new product innovation,
(4) a significant stock buy back program,
(1) volatile commodity prices,
(2) currency fluctuations.
KMB is rated A++ by Value Line, carries a 51% debt to equity ratio and its stock yields 4.0%
|Stock Yield||Dividend Growth Rate||Payout Ratio||# Increases Since 2002|
|Debt/Equity||ROE||EPS Down Since 2002||Net Margin||Value Line Rating|
Note: KMB stock made great progress off its March 2009 low, surpassing the downtrend off its June 2007 high (red line) and the November 2008 trading high (green line). Long term, the stock is in an uptrend (straight blue lines). Intermediate term, it is in an uptrend (purple lines). Short term it is in an uptrend (brown line). The High Yield Portfolio owns a 75% position in KMB. The upper boundary of its Buy Value Range is $51. The lower boundary of its Sell Half Range is $87.
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