UPDATE: UBS Maintains Kimberly Clark (KMB) at Neutral, PT Raised to $140 (correction)
UBS analyst Peter Grom maintains coverage on Kimberly Clark (NYSE: KMB) with a Neutral rating and a price target of $140.00, (from $128.00).
The analyst comments "KMB reported a better-than-expected 1Q as much stronger organic revenue growth (+10% vs. St. +6%) and better-than-feared GM performance (still down -400bps, but 100bps above Street) drove EPS upside. Importantly, even with the company's FY22 cost inflation forecast moving up by +45%, KMB maintained their outlook as the company believes stronger pricing actions will largely offset these incremental pressures. Against a backdrop where most investors anticipated a cut to guidance, we were not surprised to see shares move higher on the day, but we were somewhat surprised by the magnitude (shares finished up +8%). The path forward is largely going to hinge on the sequential progression of top line growth and margin recovery and while we certainly expect outsized EPS growth in 2H22/FY23, it remains very difficult to handicap the appropriate earnings power given the volatility. With shares now trading at ~23x our revised NTM EPS estimates, we would wait for a more attractive opportunity or higher degree of visibility that a path to 20%+ EPS growth in FY23 is possible."
For an analyst ratings summary and ratings history on Kimberly Clark click here. For more ratings news on Kimberly Clark click here.
Shares of Kimberly Clark closed at $138.51 yesterday.