Soft spending due to sluggish job growth in recent months has
taken its toll on the consumer staples sector in recent
) hasn't been immune, but overseas growth and global cost-cutting
have offset challenges elsewhere.
On Tuesday, shares gapped up 4% in heavy volume after the
maker of Huggies diapers and Kleenex tissue said third-quarter
profit rose 7% to $1.44 a share, slightly ahead of the consensus
estimate of $1.40. Sales growth was essentially flat for the
second straight quarter at $5.26 billion. Stripping out the
impact of acquisitions, divestitures and foreign exchange
fluctuations, organic sales rose 5%. The company raised its
full-year earnings guidance to $5.65 to $5.75 a share from a
prior forecast of $5.60 to $5.75. The current Thomson Reuters
consensus estimate is $5.72, up 9% from 2012.
Nearly 50% of the company's revenue comes from its Personal
Care Products division, which includes diapers and baby wipes.
Overall sales fell 1% to $2.4 billion. Sales in North America
were flat but fell in Europe because the firm scaled back its
presence in the region.
Diaper sales in emerging markets, however, were a bright spot.
Sales surged 45% in China, 35% in Russia and 20% in Brazil.
Shares have been under accumulation of late as the stock
approaches its all-time high of 106.54. The stock has been
consolidating gains since late April. During market uptrends, a
shallow, saucer-shaped pattern like the one Kimberly-Clark is
forming should be watched because they have a good record of
delivering upside breakouts. Keep in mind that a structure like
this can often see one last shakeout before a breakout.
Kimberly-Clark appears in today's Dividend Leaders screen
because of a consistent track record of earnings and dividend
growth. It paid a quarterly dividend of 81 cents a shares on Oct.
2 and currently yields 3.1%.