Piper Sandler analyst Korinne Wolfmeyer reiterated the Overweight rating on Kimberly-Clark Corporation
The company said it will issue its second quarter 2024 results on Tuesday, July 23.
The analyst writes that sentiment has been skewing more positively since the first-quarter print, and shares have remained elevated off of pre-call levels.
However, Wolfmeyer highlights that this isn't about optimistic expectations for exceeding targets. It's about investors gaining confidence in management's execution and Kimberly-Clark's resilience amid a volatile economic environment.
The analyst's data shows that volumes picked back up toward the end of the quarter. The analyst sees the current 0.5% sales decline when considering pricing dynamics.
Wolfmeyer underscores that margins should come largely in line for the quarter to be reported, and input cost inflation should not be meaningful to the profit and loss yet.
For the stock to sustain and continue its upward trajectory, it hinges on management meeting expectations, the analyst adds. Any upward revision in guidance would serve as an "upside surprise."
For the second quarter, the analyst sees total sales of $5.106 billion, down 0.5% year over year. Adj. Gross Margin is expected to be 36%. Adj. EPS for the quarter to be reported is expected to be $1.69, up 2.4%.
Price Action: KMB shares are trading higher by 0.1% to $140.94 at last check Thursday.