Kimberly-Clark (KMB) - Get Report, parent of Scott and Cottonelle toilet paper and Kleenex tissues, on Wednesday said it would raise prices on a majority of its products by mid- to high-single digits percent to offset rising commodity prices.
The price rise will go into effect in late June, the company said.
Shares of the Dallas company at last check rose 1.7% to $140.67. Kimberly-Clark stock touched a 52-week high above $160 in mid-August and exactly a year ago was trading at a 52-week low near $123.
U.S. sales of toilet paper to consumers rose 65% last year in April, according to Nielsen. That was triggered partly by hoarding during the pandemic.
Kimberly-Clark, which also makes Huggies diapers, said it would implement the price increase almost entirely through changes in list prices, in an effort to offset significantly higher commodity costs.
A couple of weeks ago, analysts at JPMorgan downgraded Kimberly-Clark to underweight from neutral.
"In regards to pulp, list price forecasts have continued to move higher following pulp price declines for much of 2019 and 2020," analysts wrote.
In January, the consumer-product major reported better-than-expected fourth-quarter earnings. The report was helped by rising sales in its consumer-tissue business related to the outbreak of COVID-19 and the work-from-home environment.
"We expect more challenging category conditions and higher commodity costs in 2021," Chairman and Chief Executive Mike Hsu had said in an earlier statement.
"That said, we remain very optimistic about our strategies to deliver balanced and sustainable growth over time and create long-term shareholder value."