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Kimberly-Clark (KMB) Dividend Analyzer Analysis

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Kimberly-Clark Dividend

(updated 5/26/2017)

The Kimberly-Clark dividend has been paid continuously since 1972 and increased for 44 consecutive years; qualifying the company as a Dividend Aristocrat and Dividend Champion.

Price: $129.48
Current Dividend: $3.88

Dividend Yield: 3.0%
Cash Dividend Payout Ratio: 56%

Market Capitalization: 46 B
Enterprise Value: 53 B

Kimberly-Clark Logo
Kimberly-Clark Logo

Description

Sector: Consumer Defensive
Industry: Household & Personal Products

Kimberly-Clark is a global leader (175+ countries) in health and hygiene products. Nearly one-quarter of the world’s population uses a Kimberly-Clark product everyday.

Kimberly-Clark holds the number 1 or 2 market share position in over 80 countries for their brands such as Kleenex, Scott, Huggies, Pull-Ups, Kotex, Poise, and Depend. The company distributes through all the major channels; including supermarkets, mass merchandisers, drug & convenience stores, and directly to consumers.

Kleenex

Dividend Analyzer Checklist

(updated February 2017)

Dividend Safety Score (15/33 points)

Dividend Per Share (ttm): $3.68
Dividend Payout Ratio (ttm): 65%
Dividend Per Share (10 Year Growth): 6.9%
Cash From Operations (CFO) Per Share (ttm): $8.94
CFO Dividend Coverage (CFO / DPS): 2.4 (2/6 points)
Free Cash Flow (FCF) Per Share (ttm): $6.80
FCF Dividend Coverage (FCF / DPS): 1.8 (4/6 points)
Net Financial Debt: $7094 M
Total Assets: $14899 M
Net Financial Debt / Total Assets: 48% (2/12 points)
Net Financial Debt to EBITDA (ttm): 210%
Total Liabilities to Assets Ratio (Qtr.): 98%
Piotroski Score (1-9) (TTM): (7/9 points)

Profitability & Growth Score (13/33 points)

Revenue (10 Year Growth) *CAGR > 4.14%: 1.6% (0/4 points)
EPS Basic Cont. Operations (10 Year Growth) CAGR > 4.14%: -1.8%% (0/4 points)
Cash From Operations (10 Year Growth) CAGR > 4.14%: 0.0% (0/6 points)
Operating Earnings Yield (ttm): 7.4% (3/7 points)
Net Income (ttm): $1994 M
Gross Profit (ttm): $6599 M
Total Assets: $14899 M
Gross Profitability Ratio = GP / Total Assets: 44% (10/12 points)
Cash Return On Invested Capital (CROIC)(tttm): 27%
Return on Invested Capital (ROIC): 25%
Return on Invested Capital (ROIC) (5 Year Median): 15%
Return on Invested Capital (ROIC) (10 Year Median): 16%

Valuation Score (17/34 points)

Free Cash Flow Yield (ttm): 5.5% (6/9 points)
EV to EBIT (ttm): 15.4 (4/9 points)
EV to EBITDA (ttm): 12.7 (4/9 points)
PE10: 27.0 (3/7 points)
Price to Sales Ratio (ttm): 2.3
Price to Book Value (ttm): 137.0
Price to Earnings Ratio (P/E) (ttm): 20.8

TOTAL POINTS – (45/100) (50 is an average score)

*Compound Annual Growth Rate (CAGR)
**A Compound Annual Growth Rate of 4.14% = a 50% gain over 10 years.

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Conclusion

(updated February 2017)

Kimberly-Clark is ranked #157 (out of 257) overall and #24 (out of 33) in the Consumer Defensive Sector by the Dividend Analyzer.

The problem with investing in KMB is you pay an expensive price for the stock of a company which currently has below average performance. Growth is almost non-existent, the balance sheet is somewhat leveraged, and the stock price is high.

Type of Investor / Recommendation

Large Diversified Dividend Portfolios /  Wait For Lower Price
Looking For Exposure to Consumer Defensive Sector / AVOID
Deep Value Investors / AVOID

Portfolio Position Disclosures:
DVB Foundation Portfolio: None
DVB Dividend Growth: None
DVB High Income: None
Arbor Asset Allocation Model Portfolio (AAAMP): None

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Disclaimer: While Arbor Investment Planner has used reasonable efforts to obtain information from reliable sources, we make no representations or warranties as to the accuracy, reliability, or completeness of third-party information presented herein. The sole purpose of this analysis is information. Nothing presented herein is, or is intended to constitute investment advice. Consult your financial advisor before making investment decisions.
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