Kimberly-Clark: well oriented, double upgrade by BofA
June 13, 2024 at 08:38 pm IST
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Kimberly-Clark posted one of the strongest gains in the S&P 500 index on the New York Stock Exchange on Thursday, on the heels of a double recommendation upgrade by analysts at Bank of America.
Shortly before 11:00 am (Wall Street time), shares in the American consumer products group climbed 2.6%, returning to their highest levels in over a year.
In a research note, BofA's teams forecast "structural changes" ahead for the maker of Kleenex tissues and Huggies diapers,
"After the inflection point experienced by volumes in the first quarter, we envisage the materialization of a long-term cycle of improvement", explains the broker.
The broker therefore expects the Group to achieve a gross margin of at least 40% by 2030, in line with the targets unveiled at its March investor day.
The broker therefore raises its recommendation from 'underperform' to 'buy', with a price target raised from $115 to $160.
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Kimberly-Clark Corporation specializes in the manufacturing and the marketing of hygiene products and personal care. Net sales break down by family products as follows:
- protection and personal care products (52.3%): disposable diapers, training pants, diapers, feminine protection products, etc. (Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Sweety, Kotex, U by Kotex, Intimus, Depend, Thinx, Poise, Plenitud, Softex and other brand names) ;
- household hygiene products (30.8%): tissues, toilet paper, paper towels, hand towels, paper napkins, wipes, etc. (Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex and other brand names);
- professional hygiene products (16.7%): hand towels, tissues, towels, apparel, disinfectants, industrial wipers, etc. (Kleenex, Scott, WypAll, Kimtech, KleenGuard and other brand names);
- others (0.2%).
At the end of 2023, the group had 82 production sites worldwide.
Noth America accounts for 54.5% of net sales.
KIMBERLY-CLARK CORPORATION 
