Kimberly-Clark Beats Wall Street Estimates with Strong Q4, Positive Outlook
Kimberly-Clark (KMB) reported impressive quarterly results on Tuesday, exceeding analyst expectations. The tissue and personal care company benefited from a recovery in demand, driving better-than-expected sales.
Solid Sales Performance
Kimberly-Clark's quarterly net sales reached $4.93 billion, surpassing the average analyst estimate of $4.86 billion. Volume growth of 1.5% and a modest price increase of 0.6% contributed to this strong performance.
Strategic Focus
The company has focused on investing in its own brands, such as Huggies, rather than its private label diaper business. This marketing and advertising push has paid off, leading to volume recovery.
Cost Management
Despite rising manufacturing and supply chain costs, Kimberly-Clark has effectively managed operating expenses. This resulted in an adjusted gross margin increase of 50 basis points year-over-year.
Positive Outlook
For the full year, Kimberly-Clark anticipates adjusted earnings per share growth in the mid-to-high single digits on a constant-currency basis. This is higher than previous estimates of a 3.2% increase to $7.58 per share.
North American Growth
In its North American business, Kimberly-Clark reported volume growth of 1.9% for the quarter ended December 31. This growth further supports the company's positive outlook.
Analyst Take
Kimberly-Clark's strong quarterly results and optimistic guidance align with industry trends, such as the resilient demand in the United States and recovery in China. Investors should pay attention to the company's ongoing cost management efforts and brand investments, which are key to its future growth prospects.