We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Kimberly-Clark Gains on Pandemic-Led Demand, Saving Efforts
Read MoreHide Full Article
Kimberly-Clark Corporation (KMB - Free Report) is gaining from its robust cost-saving plans. Moreover, the company’s K-C Strategy and other growth efforts have been yielding. Apart from these, it is witnessing higher consumer demand for its products amid the coronavirus outbreak.
Impressively, these trends continued in second-quarter 2020, with adjusted earnings increasing 32% from the year-ago quarter’s reported figure. Sales increased on the back of revenue growth across Consumer Tissue segment amid the pandemic. Further, savings from restructuring plans contributed to the results. Also, organic sales rose 4% in the second quarter.
Encouragingly, management forecasts 2020 net sales to grow in the range of 1-2%, while organic revenues are likely to rise 4-5%. The company envisions adjusted earnings per share of $7.40-$7.60 in 2020, which indicates an increase from $6.89 reported in 2019. Also, analysts look optimistic regarding the stock’s performance. Evidently, the Zacks Consensus Estimate for 2020 earnings improved 1.1% to $7.69 per share in the past 30 days.
Factors Narrating Kimberly-Clark’s Growth Story
Kimberly-Clark is undertaking robust steps to lower costs. This is highlighted from the 2018 Global Restructuring Program and the Focus on Reducing Costs Everywhere or FORCE Program. The 2018 Global Restructuring Program, which is the company’s biggest restructuring plan, focuses on enhancing profitability by simplifying the supply chain and manufacturing structures. This enables Kimberly-Clark to compete better and provides it more flexibility to undertake growth-oriented investments.
Until the end of second-quarter 2020, the company generated cumulative savings worth $380 million from the 2018 Global Restructuring Program. Management is on track to generate pre-tax savings of $500-$550 million from this program by the end of 2021. Although some of these could be realized in 2022 due to uncertainties regarding the coronavirus outbreak.
Moreover, Kimberly-Clark is aggressively cutting costs and enhancing supply-chain productivity through its FORCE Program. The program has been generating solid cost savings for a while, which are in turn driving the company’s adjusted operating profit. Also, the company remains committed to its K-C Strategy 2022, which was introduced January 2019. The strategy concentrates on strengthening the company’s brand portfolio, undertaking efficient capital allocation and executing robust cost discipline.
Apart from this, Kimberly-Clark has been focusing on its three key strategic growth pillars — improving core business in the developed markets, accelerating growth in the Personal Care segment in the developing and emerging markets as well as enhancing digital and e-commerce capacities.
Wrapping Up
Kimberly-Clark is witnessing softness in its K-C Professional segment, thanks to coronavirus woes. Also, the company’s rising marketing, research and general expenses as well as unfavorable foreign currency translations are deterrents.
Nevertheless, we believe that the aforementioned upsides are likely to keep driving this Zacks Rank #3 (Hold) company. Kimberly-Clark’s shares have gained 17.2% so far this year against the industry’s decline of 0.7%.
Grocery Outlet (GO - Free Report) , with a Zacks Rank #1, has a long-term earnings growth rate of 13.5%.
Newell Brands (NWL - Free Report) , with a Zacks Rank #2 (Buy), has a long-term earnings growth rate of 1.7%.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
Image: Bigstock
Kimberly-Clark Gains on Pandemic-Led Demand, Saving Efforts
Kimberly-Clark Corporation (KMB - Free Report) is gaining from its robust cost-saving plans. Moreover, the company’s K-C Strategy and other growth efforts have been yielding. Apart from these, it is witnessing higher consumer demand for its products amid the coronavirus outbreak.
Impressively, these trends continued in second-quarter 2020, with adjusted earnings increasing 32% from the year-ago quarter’s reported figure. Sales increased on the back of revenue growth across Consumer Tissue segment amid the pandemic. Further, savings from restructuring plans contributed to the results. Also, organic sales rose 4% in the second quarter.
Encouragingly, management forecasts 2020 net sales to grow in the range of 1-2%, while organic revenues are likely to rise 4-5%. The company envisions adjusted earnings per share of $7.40-$7.60 in 2020, which indicates an increase from $6.89 reported in 2019. Also, analysts look optimistic regarding the stock’s performance. Evidently, the Zacks Consensus Estimate for 2020 earnings improved 1.1% to $7.69 per share in the past 30 days.
Factors Narrating Kimberly-Clark’s Growth Story
Kimberly-Clark is undertaking robust steps to lower costs. This is highlighted from the 2018 Global Restructuring Program and the Focus on Reducing Costs Everywhere or FORCE Program. The 2018 Global Restructuring Program, which is the company’s biggest restructuring plan, focuses on enhancing profitability by simplifying the supply chain and manufacturing structures. This enables Kimberly-Clark to compete better and provides it more flexibility to undertake growth-oriented investments.
Until the end of second-quarter 2020, the company generated cumulative savings worth $380 million from the 2018 Global Restructuring Program. Management is on track to generate pre-tax savings of $500-$550 million from this program by the end of 2021. Although some of these could be realized in 2022 due to uncertainties regarding the coronavirus outbreak.
Moreover, Kimberly-Clark is aggressively cutting costs and enhancing supply-chain productivity through its FORCE Program. The program has been generating solid cost savings for a while, which are in turn driving the company’s adjusted operating profit. Also, the company remains committed to its K-C Strategy 2022, which was introduced January 2019. The strategy concentrates on strengthening the company’s brand portfolio, undertaking efficient capital allocation and executing robust cost discipline.
Apart from this, Kimberly-Clark has been focusing on its three key strategic growth pillars — improving core business in the developed markets, accelerating growth in the Personal Care segment in the developing and emerging markets as well as enhancing digital and e-commerce capacities.
Wrapping Up
Kimberly-Clark is witnessing softness in its K-C Professional segment, thanks to coronavirus woes. Also, the company’s rising marketing, research and general expenses as well as unfavorable foreign currency translations are deterrents.
Nevertheless, we believe that the aforementioned upsides are likely to keep driving this Zacks Rank #3 (Hold) company. Kimberly-Clark’s shares have gained 17.2% so far this year against the industry’s decline of 0.7%.
3 Solid Staple Bets
Ollie’s Bargain Outlet (OLLI - Free Report) , with a Zacks Rank #1 (Strong Buy), has a long-term earnings growth rate of 21.5%.You can see the complete list of today’s Zacks #1 Rank stocks here.
Grocery Outlet (GO - Free Report) , with a Zacks Rank #1, has a long-term earnings growth rate of 13.5%.
Newell Brands (NWL - Free Report) , with a Zacks Rank #2 (Buy), has a long-term earnings growth rate of 1.7%.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>