Jefferies lowered its rating on Kimberly-Clark Corporation ( NYSE: KMB ) on Wednesday to Hold from Buy on its view that the company has the most trade-down risk in the household personal care sector.
Analyst Kevin Grundy said the trade-down impact is already evident in tissue, wipes and diapers. The firm also sees a higher bar for operating margin recovery due to top-line risk and uncertain moderation in pulp prices.
Jefferies dropped its price target on KMB to $139 with shares trading at 19X the run-rate for FY24 EPS.
Shares of KMB fell 0.75% in late morning trading on Wednesday.
Kimberly-Clark ( KMB ) is three weeks out from reporting on Q4 earnings. Over the last 90 days, the stock has seen 9 upward EPS revisions from analysts compared to 3 downward revisions. KMB has also topped EPS estimates in five of its last six earnings reports.
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Kimberly-Clark is downgraded at Jefferies due to consumer trade-down risk