Value
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 6.5 |
| P/S | 8.9 |
| EV/EBITDA | 4.5 |
| Fwd P/E | 8.4 |
| PEG | 4.4 |
| Analyst target | 4.0 |
- ▸Forward P/E: 13.7x
- ▸PEG: 2.10
KMB · Why this verdict
Why Kimberly-Clark (KMB) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score5.5/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Kimberly-Clark has delivered four consecutive earnings beats with estimates trending upward, but the stock has already traded through its resistance-based price target to a position 1.1% above it, paired with high leverage at a debt-to-equity ratio of 3.7, a confirmed downtrend below the 200-day moving average, and free cash flow converting at only 50% of net income — a combination that makes the current entry unattractive.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Free cash flow is converting at only 50% of net income, a red flag indicating reported earnings are outpacing cash actually reaching the balance sheet and compressing the real yield available to shareholders. Quality breakdown | Free cash flow conversion rises above 75% of net income for two consecutive quarters, demonstrating that earnings are increasingly cash-backed. | →Stable |
| CounterA financial health score of 7 out of 9 and a history of stable dividends suggest the underlying business generates sufficient cash to service its obligations even while near-term conversion remains below par. | ||
The company has beaten earnings estimates in each of the last four quarters with an average positive surprise of 6.2% and estimates trending upward, demonstrating a pattern of disciplined delivery against rising expectations. Bull case | Earnings surprises remain positive and estimates continue to trend upward over the next two quarters. | →Stable |
| CounterA short interest of 15% and an elevated put/call ratio of 1.34 indicate significant institutional skepticism about whether the beat streak can continue; if volumes soften, the ability to sustain beats against rising estimates could quickly erode. | ||
The stock is trading 1.1% above its resistance-based price target of $101.99, meaning it has already surpassed the near-term ceiling and the price geometry has turned unfavorable — current holders are sitting above the identified value level, not below it. Price targets | The resistance-based target revises upward to at least $115, opening more than 10% of upside from current levels and restoring a favorable entry setup. | →Stable |
| CounterResistance levels can be re-tested and broken to the upside if the earnings beat streak continues and the broader consumer defensive sector re-rates; a sustained hold above $103 could set the stage for a revised, higher target. | ||
A debt-to-equity ratio of 3.7 leaves the balance sheet with limited flexibility, and the scoring engine assigns a leverage penalty reflecting that this level of indebtedness constrains the company's ability to absorb shocks or invest through a downturn. Bear case | Debt-to-equity ratio declines below 2.5 as cash flow is directed toward balance sheet repair over the next 12 months. | →Stable |
| CounterReturn on equity of 112% — though partly attributable to a buyback-shrunk equity base rather than pure operating returns — suggests the company has historically deployed borrowed capital productively; the leverage penalty may be less damaging if cash generation remains stable. | ||
The stock is trading below its 200-day moving average with the slope declining at 3.9% over 30 days, establishing a confirmed downtrend that means buyers are fighting against longer-term price momentum. Momentum breakdown | Price sustains above the 200-day moving average for four consecutive weeks, confirming the downtrend has reversed. | →Stable |
| CounterThe MACD is improving and RSI has risen to 64, suggesting early recovery momentum that could carry the price back above the 200-day moving average without a prolonged wait — the technical damage may already be in repair. | ||
Free cash flow is converting at only 50% of net income, a red flag indicating reported earnings are outpacing cash actually reaching the balance sheet and compressing the real yield available to shareholders.
→StableQuality breakdown
- Expectation
- Free cash flow conversion rises above 75% of net income for two consecutive quarters, demonstrating that earnings are increasingly cash-backed.
CounterA financial health score of 7 out of 9 and a history of stable dividends suggest the underlying business generates sufficient cash to service its obligations even while near-term conversion remains below par.
The company has beaten earnings estimates in each of the last four quarters with an average positive surprise of 6.2% and estimates trending upward, demonstrating a pattern of disciplined delivery against rising expectations.
→StableBull case
- Expectation
- Earnings surprises remain positive and estimates continue to trend upward over the next two quarters.
CounterA short interest of 15% and an elevated put/call ratio of 1.34 indicate significant institutional skepticism about whether the beat streak can continue; if volumes soften, the ability to sustain beats against rising estimates could quickly erode.
The stock is trading 1.1% above its resistance-based price target of $101.99, meaning it has already surpassed the near-term ceiling and the price geometry has turned unfavorable — current holders are sitting above the identified value level, not below it.
→StablePrice targets
- Expectation
- The resistance-based target revises upward to at least $115, opening more than 10% of upside from current levels and restoring a favorable entry setup.
CounterResistance levels can be re-tested and broken to the upside if the earnings beat streak continues and the broader consumer defensive sector re-rates; a sustained hold above $103 could set the stage for a revised, higher target.
A debt-to-equity ratio of 3.7 leaves the balance sheet with limited flexibility, and the scoring engine assigns a leverage penalty reflecting that this level of indebtedness constrains the company's ability to absorb shocks or invest through a downturn.
→StableBear case
- Expectation
- Debt-to-equity ratio declines below 2.5 as cash flow is directed toward balance sheet repair over the next 12 months.
CounterReturn on equity of 112% — though partly attributable to a buyback-shrunk equity base rather than pure operating returns — suggests the company has historically deployed borrowed capital productively; the leverage penalty may be less damaging if cash generation remains stable.
The stock is trading below its 200-day moving average with the slope declining at 3.9% over 30 days, establishing a confirmed downtrend that means buyers are fighting against longer-term price momentum.
→StableMomentum breakdown
- Expectation
- Price sustains above the 200-day moving average for four consecutive weeks, confirming the downtrend has reversed.
CounterThe MACD is improving and RSI has risen to 64, suggesting early recovery momentum that could carry the price back above the 200-day moving average without a prolonged wait — the technical damage may already be in repair.
Per-dimension breakdown
Quality
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 6.8 |
| Gross margin | 3.4 |
| Op margin | 7.9 |
| Net margin | 6.4 |
| Current ratio | 3.1 |
| FCF quality | 4.0 |
| Moat | 5.6 |
| Piotroski F | 7.8 |
- ▸Excellent ROE: 112%
- ▸Earnings quality RED FLAG: 50% FCF/NI
- ▸Strong Piotroski F-Score: 7/9
Growth
4.4/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.2 |
| EPS growth | 5.6 |
Momentum
7.9/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.2 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 7.5 |
| Volume | 7.9 |
- ▸Overbought (RSI 75)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat/negative + RSI 75 (late-cycle distribution risk)
Sentiment
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 6.1 |
| erm sentiment | 6.1 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Negligible insider selling — $689,696 (0.002% of mkt cap)
Peer rank
5.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.2 |
| quality rank | 8.4 |
| growth rank | 4.2 |
- ▸Superior ROE vs peers
Technical
2.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.3 |
| support resistance | 0.6 |
| 52w position | 5.7 |
Risk (lower is worse)
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 2.6 |
| days to cover | 0.4 |
| volatility | 5.9 |
| put call | 1.1 |
| implied vol | 7.9 |
| max pain risk | 3.0 |
| beta | 10.0 |
| debt equity | 1.3 |
- ▸Elevated put/call: 1.83
- ▸Above max pain $55
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.5 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 5.6 |
| dividend safety | 5.2 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 493.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position. | News modifier +1 (SELL_IF_HOLDING → HOLD_IF_HOLDING).
Engine technical detail
verdict_path:
L4:PATH_F_SELL|L3:NEWS_MOD=+1Passed (6)
- MOMENTUM:7.9>=5.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:34d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.2=NEGATIVE
Warning (2)
- DEATH_CROSS:momentum=7.9>=5.0 recovering
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-0.23
Upside
-3.2%
Downside
13.7%
Sizing output
AVOID
SetupRECOVERY — Death cross but MACD improving, RSI 75
EdgeNO_EDGE — No clear edge identified
SuitabilityMODERATE — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 4.0 below the 5.4 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Momentum at 7.9) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-0.2=NEGATIVE) reinforce the read. Current asymmetry R:R is -0.23 — supplementary context, not the trigger for this path.
The strongest dimensions are Momentum at 7.9, Catalyst at 6.5, and Quality at 6.1; the weakest are Technical at 2.2, Risk (lower is worse) at 4.0, and Growth at 4.4. The V9 engine flagged 1 failed gate with 2 warnings, producing an asymmetric reward-to-risk of -0.23 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1The company has beaten earnings estimates in each of the last four quarters with an average positive surprise of 6.2% and estimates trending upward, demonstrating a pattern of disciplined delivery against rising expectations.
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P2The stock is trading 1.1% above its resistance-based price target of $101.99, meaning it has already surpassed the near-term ceiling and the price geometry has turned unfavorable — current holders are sitting above the identified value level, not below it.
Trip ifUpside to the resistance-based price target expands beyond 10%.
- P3A debt-to-equity ratio of 3.7 leaves the balance sheet with limited flexibility, and the scoring engine assigns a leverage penalty reflecting that this level of indebtedness constrains the company's ability to absorb shocks or invest through a downturn.
Trip ifDebt-to-equity ratio falls below 2.5.
- P4The stock is trading below its 200-day moving average with the slope declining at 3.9% over 30 days, establishing a confirmed downtrend that means buyers are fighting against longer-term price momentum.
Trip ifPrice sustains above the 200-day moving average for 4 consecutive weeks.
- P5Free cash flow is converting at only 50% of net income, a red flag indicating reported earnings are outpacing cash actually reaching the balance sheet and compressing the real yield available to shareholders.
Trip ifFree cash flow conversion rises above 75% of net income for 2 consecutive quarters.