Freedom Broker upgrades Kimberly-Clark to Buy, sees 9% upside

Freedom Broker upgraded Kimberly-Clark (NYSE:KMB) from "Hold" to "Buy" on Monday, setting a price target of $121.00, while the stock traded at $111.16, deemed undervalued against a fair value of $124.75. The consumer goods maker reported Q2 net sales of $4.19 billion, missing consensus of $4.23 billion, with organic sales down 0.1%. However, adjusted gross margin of 38.8%, operating profit of $757 million, and EPS of $2.12 all beat expectations. Sales were hit by retail inventory changes and a Los Angeles warehouse fire. Kimberly-Clark, a "Dividend Aristocrat" with 53 consecutive years of increases, yields 4.76% with a P/E of 21.5. The company cut its 2026 outlook, lowering category growth guidance to 2% and adjusted EPS to a low-single-digit decline. The Suzano joint venture Albea launched July 1, with the Kenvue acquisition on track for Q4 close.