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Factors Likely to Decide Kimberly's (KMB) Fate in Q3 Earnings
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Kimberly-Clark Corporation (KMB - Free Report) is slated to release third-quarter 2017 results on Oct 23, before the opening bell. The company’s earnings have missed the Zacks Consensus Estimate in two of the trailing four quarters. In the preceding quarter, it missed the consensus mark by 0.7%. Therefore, the question lingering in investors’ minds now is whether Kimberly-Clark will be able to post positive earnings surprise in the third quarter.
Kimberly-Clark Corporation Price, Consensus and EPS Surprise
Kimberly-Clark has been witnessing slower organic sales growth in developing and emerging markets for quite some time now. While performance improved in China, it softened in Latin America, particularly in Brazil and Argentina, due to lower volumes and highly competitive promotional activity.
Though management expects modest improvement in the overall environment in developing and emerging markets in the second half of 2017, the current promotional environment is weakening the market dynamics.
In 2017, management anticipates input costs to increase owing to modestly inflationary environment. Input cost inflation are expected to be higher in the range of $200-$300 million from its previous estimate of $150-$250 million. This uptick can be attributable to higher prices for several raw materials including pulp.
Nevertheless, we note that the company’s higher cost savings, continued product innovation, strong international presence have been the catalysts that are expected to drive growth. For 2017, the company expects to generate cost savings in the range of $425 to $450 million from the FORCE program, up from the prior estimate of $400 million.
Notably, the Zacks Consensus Estimate for the quarter under review is pegged at $1.54. Although the current-quarter estimate has moved down by a penny in the last seven days, it is couple of cents above from the prior-year quarter figure. The consensus estimate for revenue is currently pegged at $4,668 million for the to-be-reported quarter, reflecting a year-over-year increase of 1.6%.
Expectations of an increase in both the top and bottom lines boost investor confidence about the stock’s performance in the quarter.
Sales for Personal Care, Consumer Tissue and K-C Professional segments are projected to be $2,354 million, $1,490 million and $817 million, respectively. These estimates show a year-over-year increase of 1.8%, 1.2% and 1.9% for each segment, respectively.
Further, we note that volumes are estimated to increase 0.03% for both the Personal Care and Consumer Tissue segments, and 0.02% for the K-C Professional segment.
What the Zacks Model Unveils
Our proven model does not conclusively show that Kimberly-Clark is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Kimberly-Clark has an Earnings ESP of +0.08% per share. However, the company’s Zacks Rank #4 (Sell) lowers the chances of a beat in the ensuing release.
Stocks Poised to Beat Earnings Estimates
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Colgate-Palmolive Company (CL - Free Report) has an Earnings ESP of +0.14% and a Zacks Rank #3.
Avon Products, Inc. has an Earnings ESP of +6.06% and a Zacks Rank #3.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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Factors Likely to Decide Kimberly's (KMB) Fate in Q3 Earnings
Kimberly-Clark Corporation (KMB - Free Report) is slated to release third-quarter 2017 results on Oct 23, before the opening bell. The company’s earnings have missed the Zacks Consensus Estimate in two of the trailing four quarters. In the preceding quarter, it missed the consensus mark by 0.7%. Therefore, the question lingering in investors’ minds now is whether Kimberly-Clark will be able to post positive earnings surprise in the third quarter.
Kimberly-Clark Corporation Price, Consensus and EPS Surprise
Kimberly-Clark Corporation Price, Consensus and EPS Surprise | Kimberly-Clark Corporation Quote
Factors Likely to Impact the Quarter
Kimberly-Clark has been witnessing slower organic sales growth in developing and emerging markets for quite some time now. While performance improved in China, it softened in Latin America, particularly in Brazil and Argentina, due to lower volumes and highly competitive promotional activity.
Though management expects modest improvement in the overall environment in developing and emerging markets in the second half of 2017, the current promotional environment is weakening the market dynamics.
In 2017, management anticipates input costs to increase owing to modestly inflationary environment. Input cost inflation are expected to be higher in the range of $200-$300 million from its previous estimate of $150-$250 million. This uptick can be attributable to higher prices for several raw materials including pulp.
Nevertheless, we note that the company’s higher cost savings, continued product innovation, strong international presence have been the catalysts that are expected to drive growth. For 2017, the company expects to generate cost savings in the range of $425 to $450 million from the FORCE program, up from the prior estimate of $400 million.
Notably, the Zacks Consensus Estimate for the quarter under review is pegged at $1.54. Although the current-quarter estimate has moved down by a penny in the last seven days, it is couple of cents above from the prior-year quarter figure. The consensus estimate for revenue is currently pegged at $4,668 million for the to-be-reported quarter, reflecting a year-over-year increase of 1.6%.
Expectations of an increase in both the top and bottom lines boost investor confidence about the stock’s performance in the quarter.
Sales for Personal Care, Consumer Tissue and K-C Professional segments are projected to be $2,354 million, $1,490 million and $817 million, respectively. These estimates show a year-over-year increase of 1.8%, 1.2% and 1.9% for each segment, respectively.
Further, we note that volumes are estimated to increase 0.03% for both the Personal Care and Consumer Tissue segments, and 0.02% for the K-C Professional segment.
What the Zacks Model Unveils
Our proven model does not conclusively show that Kimberly-Clark is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Kimberly-Clark has an Earnings ESP of +0.08% per share. However, the company’s Zacks Rank #4 (Sell) lowers the chances of a beat in the ensuing release.
Stocks Poised to Beat Earnings Estimates
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
The Estee Lauder Companies Inc. (EL - Free Report) has an Earnings ESP of +0.26% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Colgate-Palmolive Company (CL - Free Report) has an Earnings ESP of +0.14% and a Zacks Rank #3.
Avon Products, Inc. has an Earnings ESP of +6.06% and a Zacks Rank #3.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>