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KMB Accelerates Growth Through Digital & Club Channel Expansion

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Key Takeaways

  • KMB's Q3 highlights a shift toward digital and club channels as its primary growth engines.
  • North America saw all recent growth from digital, with KMB gaining a seven-point online share edge.
  • Club channels posted double-digit gains, driven by consumer migration and improved retailer assortments.

Kimberly-Clark Corporation's (KMB - Free Report) third-quarter fiscal 2025 performance underscores a pivotal shift in the company’s growth model, with digital and club channels emerging as the primary growth engines. This transition reflects evolving consumer habits and supports the company’s strategy to align its portfolio with evolving purchasing behavior. As shoppers increasingly favor convenience, value and flexibility, these channels are proving essential to sustaining long-term momentum.

In North America, digital channel has become the centerpiece of growth. Management reported that 99% of last year’s growth originated from online channels, and this year the figure reached the 100% mark. This digital success is further reinforced by a substantial share advantage. KMB's share is higher by a remarkable seven points in digital channels compared with its traditional brick-and-mortar footprint.

The club channel also shows continued robust performance with double-digit growth. This expansion is driven by both consumer migration to the club format and favorable assortment changes at major retailers. While the heavy skew toward club packs creates a slight negative mix headwind for U.S. diapers in the short term, this expansion ensures Kimberly-Clark is effectively meeting value-seeking consumers with larger pack sizes.

This strong channel execution proves that KMB is winning where consumers are choosing to shop. By establishing a dominant position in e-commerce and maximizing presence in high-volume club stores, Kimberly is ensuring its long-term base is resilient and aligned with modern consumer purchasing trends. With greater visibility, faster feedback and broader consumer reach, these platforms represent a structural tailwind that solidifies the company’s competitive position.

Kimberly’s Price Performance, Valuation & Estimates

KMB, which competes with Village Farms International (VFF - Free Report) and Ollie's Bargain Outlet (OLLI - Free Report) , has seen its shares decline 22.7% in the past six months as compared with the industry’s fall of 12.4%. Meanwhile, shares of Village Farms and Ollie's Bargain have rallied 186.5% and 4.7%, respectively.

 

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Kimberly’s forward 12-month price-to-earnings ratio of 15.17 reflects a lower valuation than the industry’s average of 18.42. TGT has a Value Score of D. KMB is trading at a discount to Village Farms (with a forward 12-month P/E ratio of 15.19) and Ollie's Bargain (27.75).

 

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The Zacks Consensus Estimate for KMB’s 2025 earnings implies a year-over-year decline of 12.6%, while the same for 2026 indicates growth of 11.3%. Earnings estimates for 2025 and 2026 have been southbound by four cents and upbound by 9 cents per share, respectively, in the past 30 days.

 

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Kimberly currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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