Is Kimberly-Clark’s Stock a Buy Now?

With shares of Kimberly-Clark Corporation (NYSE:KMB) trading at around $86.26, is KMB an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock’s Movement

Kimberly-Clark recently reported earnings that were slightly better than expected. Some investors were happy with the results, but others were annoyed by the fact that they weren’t better. For the latter, it’s important to look at the max chart. It’s a steady incline, and that’s not likely to change at any point in the foreseeable future. There will be some bumps in the road, but that’s the case for any successful stock. This is a company/stock that attracts the wise, long-term investor who appreciates slow and steady growth while collecting dividend payments. This is also one of the most underrated blue chip stocks out there. Despite everything it has to offer, it’s not heavily traded.

As far as earnings go, Q4 net sales were $5.3 billion, which was a 3 percent increase year-over-year. Diluted EPS came in at $0.68 compared to $1.01 for the same quarter last year. FY2012 EPS came in at $4.42 versus $3.99 in 2011. Revenue also improved to $21.06 billion from $20.85 billion in 2011. Kimberly-Clark saw 5 percent organic sales growth, and 1 percent growth in K-C International. Gross margins improved by 230 basis points, and adjusted operating profit margins improved by 90 basis points. Kimberly-Clark also saved $335 million from the FORCE program and restructuring. In addition to that, Q4 saw cash provided by operations increased by 116 percent.

Kimberly-Clark expects to increase the dividend at a high single-digit rate effective April 2013. The company has increased the dividend for 41 consecutive years. Share repurchases for 2013 are expected to be between $1.0 and $1.2 billion.

It looks like a great story so far, but let’s take a look at some important numbers for confirmation…