Kimberly Clark
develops, manufactures and markets personal care products (Huggies, Pull Ups,
Little Swimmers, Goodnights, Kotex, Depends, Kleenex, Scott, Cottonelle tissue,
Viva paper towels, workplace health products [soaps, sanitizers, etc.] and
healthcare products). KMB has
grown its profits and dividends at a 4-10% 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 2008-2011 as customers ‘traded down’ to generic
brands. However, the company has seen 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 buyback program.
Negatives:
(1) volatile
commodity prices,
(2)
macro-economic uncertainty.
Statistical Summary
Stock Dividend Payout # Increases
Yield Growth Rate Ratio
Since 2004
Ind Ave 2.3 10 49 NA
Debt/ EPS Down Net Value Line
Equity ROE Since 2004 Margin Rating
Ind Ave 48 16 NA 8 NA
Chart
Note:
KMB stock made great progress off its March 2009 low, quickly surpassing the downtrend
of its June 2007 high (straight red line) and the November 2008 trading high
(green line). Long term it is in an
uptrend (blue lines). Intermediate term,
it is in an uptrend (purple lines). The
wiggly red line is the 50 day moving average.
The High Yield Portfolio owns a 50% in KMB, having Sold Half of its
holding at around $85 per share in early 2013.
The upper boundary of its Buy Value Range is $54; the lower boundary of
its Sell Half Range is $93.
7/14
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