Health and hygiene products maker Kimberly-Clark Corporation (
) on Tuesday saw its coverage initiated with a "Buy" rating by
analysts at Janney Montgomery Scott.
The firm also set a $75 price target on KMB, which implies a 22%
upside to the stock's Monday closing price of $61.53.
A JMS analyst commented, "What makes Kimberly's portfolio unique
is its participation in categories with few substitutes and high
market share concentration. Try as a stretched consumer may, there
are few alternatives to restocking depleted inventories of baby
care, feminine care, and adult care products - which have sustained
consistent (range of +3% to +9% since 2003) and very robust (+6.9%
5-year average) organic growth in the company's largest segment,
personal care (58% of profit)…As opposed to the +3% EPS expected
growth implied by today's valuation (12.2x P/E, 4.3% dividend
yield), we believe the mid-point of guided 4%-9% long-term growth
is easily achievable - the basis of our $75 fair value
Kimberly-Clark shares were mostly flat in premarket trading
The Bottom Line
We have been recommending shares of Kimberly Clark (
) since July 23, 2009, when the stock was trading at $54.46. The
company has a 4.29% dividend yield, based on last night's closing
stock price of $61.53.
Kimberly-Clark Corporation (
) is a "Recommended" dividend stock, holding a Dividend.com DARS™
Rating of 3.5 out of 5 stars.
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
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