Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Unilever plc (ADR) (UL): How Kimberly Clark Corp (KMB)’s Dividend Keeps Getting Bigger

Page 1 of 2

Dividend investors look for different things from the stocks they choose, with some looking for high yields while others want solid dividend growth. Kimberly Clark Corp (NYSE:KMB) is a rare example of a stock that has something for everyone, with a yield that’s well above average combined with a long track record of raising its dividend payouts annually. With 41 straight years of dividend increases, Kimberly-Clark qualifies for membership in the elite ranks of the Dividend Aristocrats, joining just a few dozen stocks that have put together 25-year track records of annual raises in their payouts.

Kimberly Clark Corp (NYSE:KMB) is the company behind the Kleenex brand name, with a wide array of personal- and health-care products as well as tissues and sanitizers. Households throughout the U.S. and around the world regularly rely on Kimberly-Clark’s products, helping the company maintain consistent financial performance even in challenging markets. Let’s take a closer look at Kimberly-Clark to see whether it’s likely to be able to sustain or even improve on its dividend growth.

Dividend Stats on Kimberly-Clark

Current Quarterly Dividend Per Share $0.81
Current Yield 3.5%
Number of Consecutive Years With Dividend Increases 41 years
Payout Ratio 66%
Last Increase March 2013

Source: Yahoo! Finance. Last increase refers to ex-dividend date.

Can Kimberly-Clark give investors everything they want?
On top of a strong yield and consistent dividend growth, Kimberly Clark Corp (NYSE:KMB) has seen its shares rise dramatically over the past several years, hitting all-time record highs during the spring of 2013. Share-price gains of almost 20% over the past year have built on a longtime track record of success, with total returns of about 11% annually since 1993.

Kimberly Clark Corp (NYSE:KMB)Kimberly Clark Corp (NYSE:KMB)’s relatively modest size doesn’t keep it from being competitive even in a crowded industry worldwide. The Procter & Gamble Company (NYSE:PG) and Unilever plc (ADR) (NYSE:UL) are global giants with much larger market capitalizations and revenue figures, yet Kimberly-Clark has defied their potential dominance and managed to rank No. 1 or No. 2 in market share for its top brands in 80 different countries across the globe.

Still, more recently, investors seem to have gotten more sensitive to Kimberly-Clark’s share-price valuation. With the stock fetching a trailing earnings multiple above 20, Kimberly Clark Corp (NYSE:KMB) is fairly pricey for a stock with modest growth prospects. Moreover, rising costs have pressured margins throughout the industry, putting a lid on potential earnings increases and thereby making it even harder for the company to justify a rich multiple despite its healthy dividend yield.

We’ve also seen rising interest rates in the bond market put pressure on dividend stocks more generally. As bond yields rise, dividend yields have to rise in tandem in order to maintain their relative attractiveness. That in turn tends to push share prices down. Combined with valuation concerns, the impact on Kimberly Clark Corp (NYSE:KMB) has been to knock about 10% off its shares in recent months.

KMB Dividend Chart

Kimberly-Clark Dividend data by YCharts.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!