Kimberly-Clark rated Buy on strong innovation, global growth, and Kenvue deal synergies despite short-term challenges.

Kimberly-Clark is rated Buy due to its robust innovation pipeline, international expansion, and potential gains from the Kenvue acquisition. While facing temporary challenges in North America and China, these issues are expected to ease, with management projecting mid- to high-single-digit EPS growth from 2026 to 2028. The Kenvue deal will initially reduce earnings per share but synergy targets of $1.9 billion in cost savings and $1.4 billion in revenue are progressing ahead of schedule. Kimberly-Clark trades at a forward P/E below its five-year average and offers a 4.68% dividend yield, making it an attractive risk/reward investment.