Kimberly-Clark: A worry-free stock

This boring toilet-paper-and-tissues company has raised dividends like clockwork for 39 years.

By TheStockAdvisors Oct 14, 2011 12:21PM
By Amy Calistri, The Daily Paycheck

Finding stocks that don't get caught in the fallout of a market sell-off can be difficult; but Kimberly Clark (KMB) is one that we don't have to worry about.

In fact, during the sell-off started in late July the stock had been a star; while the S&P 500 was down 17.5%, Kimberly-Clark was actually up 7.4%.

KMB makes paper-based consumer products like facial tissues and toilet paper. You probably recognize some of their brands like Kleenex and Cottonelle.

Paper products aren't exciting, but they do see consistent demand no matter what the broader economy is doing.

We own shares of Kimberly-Clark in our real-money Stock of the Month portfolio. I originally added the shares back in June of 2010. Since then, it's been one stock I haven't had to worry about.

Part of the reason is that its "boring" business of selling toilet paper and tissues also helps power one of the steadiest dividends on the market.

The company has raised its dividend like clockwork for the past 39 years. In fact, in the last 10 years alone KMB has raised its quarterly dividend by 154%.

Every share bought just five years ago has paid out $12.45 since, providing a 23% gain on dividends alone.

Buying shares of KMB now would lock in a yield of 3.9%. That may not sound like a lot, but considering that 10-year Treasuries yield less than 2% and a savings account earns next to nothing, it's not a bad play for income investors looking for a safe bet with a decent yield.

And consider that right now we're seeing high unemployment, concerns about a recession, and the continuous angst about government deficits. That's a lot of worry. You might sleep better owning KMB.

TheStockAdvisors.com​​ is a free website that highlights stock recommendations and market commentary from leading financial newsletter advisers.

2Comments
Oct 15, 2011 8:26AM
avatar
I'm thinking KMB is a little on the pricey side right now.  I have a buy on it at $64.  It needs to come down about 10% before I'll look at it. 
Oct 14, 2011 4:24PM
avatar
Agreed olekobe, KMB is tempting in the mid-sixties, but as of right now its close to 72, 
Buy high everyone! lol
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

125
125 rated 1
264
264 rated 2
485
485 rated 3
679
679 rated 4
640
640 rated 5
617
617 rated 6
632
632 rated 7
493
493 rated 8
276
276 rated 9
153
153 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
TAT&T Inc9
VZVERIZON COMMUNICATIONS8
CTLCENTURYLINK Inc8
EXCEXELON CORPORATION8
AAPLAPPLE Inc10
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.