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Kimberly-Clark Makes Management Changes to Fuel Growth

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Kimberly-Clark Corp. (KMB - Free Report) has been reshuffling its management for some time now. Recently, the company announced that its Chief Human Resources Officer ("CHRO"), Liz Gottung will retire at the end of 2016.

Gottung held various leadership roles in Kimberly-Clark for 35 years. As the leader of its HR organization, she aligned this function with the company's overall business strategy and championed the culture.

Kimberly-Clark has appointed Scott Boston as Gottung's successor. Boston, who joined the company in 2011, has led global HR talent management with an experience for leading HR within Kimberly-Clark International. He will take up the position of senior vice president and CHRO from Jan 1, 2017. Gottung will work with him for a smooth transition.

Boston is a strategic fit for this role, as he has more than 20 years of global HR leadership experience. Prior to joining Kimberly-Clark, Boston was senior vice president, Human Resources, for McKesson Corporation. We believe Boston’s leadership will further strengthen the company’s business.

KIMBERLY CLARK Price and Consensus

 

KIMBERLY CLARK Price and Consensus | KIMBERLY CLARK Quote

Overall, we are impressed with Kimberly-Clark’s cost-saving initiatives and continued product innovation that have been driving earnings for the past many quarters. It also achieved higher organic sales on the back of volume growth and better pricing. However, the company recently shut down its operations in Venezuela due to economic crisis in the region. Also, it is facing lawsuits related to the spin-off of its health care business, now named as Halyard Health, Inc. , in Oct 2014. These headwinds are expected to hurt investors’ confidence.

In the last reported second quarter of 2016, Kimberly-Clark posted better-than-expected results, wherein both earnings and revenues beat the Zacks Consensus Estimate.

Adjusted earnings in the quarter increased 8.5% from the year-ago figure, boosted by organic sales growth, cost savings, input cost deflation, margin improvements and lower tax rates. However, sales declined 1.2% from the prior-year quarter, mainly due to foreign currency headwinds. Organic sales grew 3% from the prior-year quarter, mainly driven by volumes, which offset the product mix.

Kimberly-Clark has a Zacks Rank #3 (Hold).

Better-ranked stocks in the consumer staples sector include Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) and Ingredion Inc. (INGR - Free Report) . Both stocks hold a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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