Kimberly-Clark Pays 3.3% Dividend Yield, Continues Annual Dividend Boosts (KMB)
By: Ned Piplovic,
The Kimberly-Clark Corporation pays a 3.3% current dividend yield and has boosted its annual dividend amount every year since 1972.
While the share price is only marginally higher than it was 12 months ago, the price has been rising notably over the last three weeks. That ascent indicates a potential end of the recent three-month downtrend.
Kimberly-Clark is one of the 51 Dividend Aristocrat companies. These are S&P 500 companies that have raised their annual dividends for a minimum of 25 consecutive years and have a market capitalization of at least $3 billion.
The next ex-dividend date is on December 7, 2017. The pay date is scheduled for early next year on January 3, 2018.
Kimberly-Clark Corporation (NYSE:KMB)
Founded in 1872 and headquartered in Dallas, Texas, the Kimberly-Clark Corporation manufactures and markets personal care, consumer tissue and professional products worldwide. The company’s 42,000 employees support manufacturing operations in 35 countries and sale of Kimberly-Clark products in almost 180 countries. The Personal Care segment offers disposable diapers and baby wipes, as well as feminine and incontinence care products. Kimberly-Clark distributes these products under multiple brand names, which include Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Kotex, U by Kotex, Depend and Poise. Under the Consumer Tissue segment, the company provides facial and bathroom tissues, paper towels, napkins and related products under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Neve and other brand names. The K-C Professional segment offers wipes, tissues, towels, apparel, soaps and sanitizers under the Kleenex, Scott, WypAll, Kimtech and Jackson Safety brands.
While Kimberly-Clark has a decades-long record of rising dividends and reliable asset appreciation, the company’s current share price is only marginally higher than it was one year ago. The share price started its current trailing 12 months with a robust growth of almost 16% from November 29, 2016, to February 22, 2017, and reached its 52-week high of $135.00 by March 15, 2017. After peaking in mid-March, the share price traded flat in the $127 to $134 range for nearly four months. In late June, the share price embarked on a downtrend that did not end until October 30, 2017, when the price hit its 52-week low of $111.27, which was more than 21% below the March peak. However, the share price experienced an immediate trend reversal and has been rising since bottoming out at the end of October 2017. The share price closed on November 28, 2017, at $117.38, which is 0.8% higher than it was 12 months ago and 5.5% higher than the 52-week low from four weeks ago.
While the share price continues its upward trend in the short term, the company’s dividend continues to provide its shareholders with a steady stream of rising income over the long term. The current quarterly dividend of $0.97 is 5.4% higher than the $0.92 payout from the same period last year. On an annualized basis, the current payout is equivalent to a $3.88 annual distribution and a 3.3% yield.
Based on Kimberly-Clark’s recent dividend distribution pattern, the company should raise its quarterly dividend payout again in the next quarter. If the company follows the recent trend, a dividend hike of around 5% would result in a quarterly dividend payout of more than $1.00, which would push the annualized amount above $4.00 per share.
The company has been hiking its annual dividend for the past 45 consecutive years. Just over the past two decades, the annual dividend amount rose at an average rate of 7.1% per year, resulting in a four-fold annual dividend increase since 1997. However, over the entire streak of 45 consecutive annual dividend boosts, the result is an even more impressive average growth rate of 9.4% per year, which resulted in a 56-fold annual dividend increase since 1972.
In addition to continuously improving against its own dividend results, Kimberly-Clark’s current 3.3% yield is 72% higher than the 1.92% average yield of all the companies in the Personal Products segment and 89% higher than the 1.75% average yield of the entire Consumer Products sector.
While Kimberly-Clark’s stock is a proven source of rising income from dividends, it also might provide moderate asset appreciation to accompany that income, at least in the short term.
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Ned Piplovic is the assistant editor of website content at Eagle Financial Publications. He graduated from Columbia University with a Bachelor’s degree in Economics and Philosophy. Prior to joining Eagle, Ned spent 15 years in corporate operations and financial management. Ned writes for www.DividendInvestor.com and www.StockInvestor.com.