Since December 2024, Kimberly-Clark has been in a holding pattern, posting a small loss of 3.7% while floating around $128.23.
Is there a buying opportunity in Kimberly-Clark, or does it present a risk to your portfolio? See what our analysts have to say in our full research report, it’s free.
Why Is Kimberly-Clark Not Exciting?
We're swiping left on Kimberly-Clark for now. Here are three reasons why we avoid KMB and a stock we'd rather own.
1. Long-Term Revenue Growth Flatter Than a Pancake
A company’s long-term sales performance can indicate its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Unfortunately, Kimberly-Clark struggled to consistently increase demand as its $19.75 billion of sales for the trailing 12 months was close to its revenue three years ago. This wasn’t a great result and is a sign of lacking business quality. 
2. Sales Volumes Stall, Demand Waning
Revenue growth can be broken down into changes in price and volume (the number of units sold). While both are important, volume is the lifeblood of a successful staples business as there’s a ceiling to what consumers will pay for everyday goods; they can always trade down to non-branded products if the branded versions are too expensive.
Kimberly-Clark’s quarterly sales volumes have, on average, stayed about the same over the last two years. This stability is normal because the quantity demanded for consumer staples products typically doesn’t see much volatility. 
3. Revenue Projections Show Stormy Skies Ahead
Forecasted revenues by Wall Street analysts signal a company’s potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite.
Over the next 12 months, sell-side analysts expect Kimberly-Clark’s revenue to drop by 1.8%, a decrease from This projection is underwhelming and implies its products will face some demand challenges.
Final Judgment
Kimberly-Clark isn’t a terrible business, but it doesn’t pass our quality test. That said, the stock currently trades at 16.8× forward P/E (or $128.23 per share). Beauty is in the eye of the beholder, but our analysis shows the upside isn’t great compared to the potential downside. We're pretty confident there are superior stocks to buy right now. Let us point you toward the most dominant software business in the world.
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