Kimberly-Clark Corp

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KMB : NYSE : Consumer Goods
$134.63 | %
Today's Range: 133.57 - 134.65
Avg. Daily Volume: 1,696,100
07/22/16 - 4:01 PM ET

Financial Analysis


KIMBERLY-CLARK CORP's gross profit margin for the first quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. KIMBERLY-CLARK CORP has weak liquidity. Currently, the Quick Ratio is 0.54 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

At the same time, stockholders' equity ("net worth") has significantly decreased by 43.52% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)4476.04691.0
EBITDA ($mil)1000.01022.0
EBIT ($mil)828.0828.0
Net Income ($mil)545.0468.0


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)635.0587.0
Total Assets ($mil)14820.015053.0
Total Debt ($mil)7903.07731.0
Equity ($mil)109.0193.0


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin40.4639.78
EBITDA Margin22.3421.78
Operating Margin18.517.65
Sales Turnover1.241.3
Return on Assets7.359.67
Return on Equity1000.0757.51
Debt Q1 FY16 Q1 FY15
Current Ratio0.960.87
Debt/Capital0.990.98
Interest Expense76.072.0
Interest Coverage10.8911.5


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)360.2364.3
Div / share0.920.88
EPS1.51.27
Book value / share0.30.53
Institutional Own % n/a n/a
Avg Daily Volume1784405.01890349.0

Valuation


BUY. KIMBERLY-CLARK CORP's P/E ratio indicates a significant premium compared to an average of 34.55 for the Household Products industry and a significant premium compared to the S&P 500 average of 25.03. For additional comparison, its price-to-book ratio of 449.07 indicates a significant premium versus the S&P 500 average of 2.80 and a significant premium versus the industry average of 75.17. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. After reviewing these and other key valuation criteria, KIMBERLY-CLARK CORP proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
KMB 45.60 Peers 34.55   KMB 17.27 Peers 17.14

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

KMB is trading at a significant premium to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

KMB is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
KMB 20.70 Peers 24.32   KMB 0.38 Peers 1.30

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

KMB is trading at a valuation on par with its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

KMB trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
KMB 449.07 Peers 75.17   KMB -23.59 Peers -15.44

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

KMB is trading at a significant premium to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, KMB is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
KMB 2.66 Peers 3.37   KMB -5.90 Peers -4.17

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

KMB is trading at a discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

KMB significantly trails its peers on the basis of sales growth

 

 

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