KMB  Kimberly-clark Corporation

Exchange

NYSE

Sector

Consumer Durables

Industry

Containers/Packaging

Market Cap.

39.75B

Vuru Grade

55.12/100

Current Price

$112.51
+1.24 (+1.11%)

Growth Price

$39.76
Overvalued by 64.66%

Stability Price

$14.56
Overvalued by 87.06%

Company Metrics

  • P/E 18.79
  • P/S 2.16
  • P/B 385.02
  • EPS 5.99
  • Cash ROIC 22.12%
  • Cash Ratio 0.11
  • Dividend 3.88 / 3.45%
  • Avg. Vol. 1.71M
  • Shares 353.30M
  • Market Cap. 39.75B

Company Description

Kimberly-Clark Corporation, together with its subsidiaries, engages in the manufacture and marketing of various health care products worldwide. The company operates in four segments: Personal Care, Consumer Tissue, K-C Professional & Other, and Health Care. The Personal Care segment provides disposable diapers, training and youth pants, and swimpants; baby wipes; and feminine and incontinence care... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

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Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for KMB to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate KMB's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$112.51 Current Price

$39.76 Growth Price (DCF)

Overvalued by 64.66%


Growth Rate Assumed by Market: 25.42%


Future Free Cash Flow Growth Rate: -0.7%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$14.56 Stability Price (EPV)

Overvalued by 87.06%


Discount Rate: 15.0%

$-69.16 Book Price

Overvalued by 161.47%


Excellent Cash Return on Invested Capital over the past 5 years

KMB has efficiently invested its financial resources in buildings, projects, and equipment, resulting in strong returns. Annual Reports can be useful in identifying the cause of one-time events and future sustainability.

KMB has created $22.12 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20132014201520162017
Free Cash Flow 2.09B 1.81B 1.25B 2.46B 2.14B
divided by
Invested Capital 12.02B 8.51B 7.87B 7.83B 8.68B
Cash ROIC 17.37% 21.22% 15.88% 31.42% 24.71%

Varying Return on Equity over the past 5 years

KMB has generated strong profits with money shareholders have invested. However, there is a substantial variation in their Return on Equity from year-to-year. This may reflect management's inability to generate consistent returns or may be caused by one-time events. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

KMB has generated $126.64 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20132014201520162017
Net Income 2.22B 1.60B 1.07B 2.22B 2.32B
divided by
Stockholders' Equity 4.86B 729.00M -174.00M -102.00M 629.00M
Return on Equity 45.74% 218.79% - - 368.68%

Excellent Business Performance over the past 10 years

KMB has been able to maintain profitability in good times and bad. This could mean KMB has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

KMB has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in December
2008200920102011201220132014201520162017
Free Cash Flow 1.61B 2.63B 1.78B 1.32B 2.20B 2.09B 1.81B 1.25B 2.46B 2.14B

Weak Balance Sheet

KMB's financial position is not ideal. The key is to check whether KMB is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2008200920102011201220132014201520162017
Cash 364.00M 987.00M 876.00M 764.00M 1.11B 1.05B 789.00M 619.00M 923.00M 616.00M
Current Assets 5.81B 5.86B 6.33B 6.28B 6.59B 6.55B 5.56B 5.43B 5.12B 5.21B
Total Assets 18.09B 19.21B 19.86B 19.37B 19.87B 18.92B 15.53B 14.84B 14.60B 15.15B
Current Liabilities 4.75B 4.92B 5.34B 5.40B 6.09B 5.85B 6.23B 6.35B 5.85B 5.86B
Total Liabilities 14.21B 13.80B 13.95B 14.12B 14.89B 14.06B 14.80B 15.02B 14.70B 14.52B
Stockholder' Equity 3.88B 5.41B 5.92B 5.25B 4.99B 4.86B 729.00M -174.00M -102.00M 629.00M
Current Ratio 1.22 1.19 1.19 1.16 1.08 1.12 0.89 0.85 0.87 0.89
TL-to-TA 0.79 0.72 0.70 0.73 0.75 0.74 0.95 1.01 1.01 0.96

Low or No Reinvestment of Profits over the past 10 years

KMB has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to KMB operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2008200920102011201220132014201520162017
Retained Earnings 9.47B 10.33B 11.09B 8.24B 8.82B 9.71B 8.47B 4.99B 5.83B 6.73B
Retained Earnings Growth - 9.13% 7.33% -25.64% 7.02% 10.10% -12.81% -41.04% 16.76% 15.42%

Competitive Industry over the past 10 years

KMB is likely operating in an industry with medium to low barriers to entry. This may mean that KMB doesn't have a characteristic that's hard to replicate, such as exclusive distribution, branding or the ability to keep costs low. If Gross Margins are at least satisfactory, it's likely that KMB invests heavily in R&D and Sales, General & Administrative expenses.

Only $9.45 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2008200920102011201220132014201520162017
Net Income 1.70B 1.99B 1.94B 1.59B 1.83B 2.22B 1.60B 1.07B 2.22B 2.32B
divided by
Revenue 19.42B 19.12B 19.75B 20.85B 21.06B 21.15B 19.72B 18.59B 18.20B 18.26B
Net Profit Margin 8.75% 10.43% 9.84% 7.63% 8.68% 10.50% 8.09% 5.73% 12.19% 12.70%

Satisfactory Pricing Power over the past 10 years

Consistency is vital. KMB has been able to maintain gross margins fairly consistently, which is a strong indication of their ability to raise prices with inflation. This potentially leaves flexibility in inflationary environments to raise prices on consumers and maintain profitability.

$33.47 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2008200920102011201220132014201520162017
Gross Profit 5.86B 6.42B 6.55B 6.15B 6.75B 7.24B 6.68B 6.62B 6.65B 6.55B
divided by
Revenue 19.42B 19.12B 19.75B 20.85B 21.06B 21.15B 19.72B 18.59B 18.20B 18.26B
Gross Margin 30.17% 33.59% 33.17% 29.51% 32.04% 34.23% 33.88% 35.63% 36.54% 35.89%

High Capital Intensity over the past 10 years

KMB spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

54.18% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2008200920102011201220132014201520162017
Capital Expenditure 906.00M 848.00M 964.00M 968.00M 1.09B 953.00M 1.04B 1.06B 771.00M 785.00M
divided by
Net Income 1.70B 1.99B 1.94B 1.59B 1.83B 2.22B 1.60B 1.07B 2.22B 2.32B
Capital Expenditure Ratio 53.36% 42.53% 49.61% 60.84% 59.79% 42.91% 65.14% 99.06% 34.75% 33.85%

Very Strong Dividend History over the past 10 years

KMB has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests KMB is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in USD. Fiscal year ends in December
2008200920102011201220132014201520162017
Dividend Paid 950.00M 986.00M 1.07B 1.10B 1.15B 1.22B 1.26B 1.27B 1.31B 1.36B
divided by
Shares Outstanding 418.60M 416.80M 414.40M 398.60M 396.10M 387.30M 377.40M 366.30M 361.70M 355.90M
Dividend Paid Per Share 2.27 2.37 2.57 2.76 2.91 3.16 3.33 3.47 3.62 3.82
Price at Year End 46.38 59.19 60.47 73.56 83.13 105.93 117.35 129.43 114.12 128.11
Dividend Yield 4.89% 4.00% 4.25% 3.75% 3.50% 2.98% 2.84% 2.68% 3.18% 2.98%

Strong History of Stock Buybacks over the past 10 years

KMB has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2008200920102011201220132014201520162017
Shares Outstanding 418.60M 416.80M 414.40M 398.60M 396.10M 387.30M 377.40M 366.30M 361.70M 355.90M
Stock Bought Back - 0.43% 0.58% 3.96% 0.63% 2.27% 2.62% 3.03% 1.27% 1.63%
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