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Kimberly-Clark: No Longer Serves As A Safe Haven Stock

Sep. 02, 2022 8:21 AM ETKimberly-Clark Corporation (KMB)13 Comments
Zoltan Ban profile picture
Zoltan Ban


  • Kimberly-Clark is often viewed as a recession-proof safe haven investment because it sells goods that see very little demand destruction under most circumstances.
  • While the assumption about the demand for Kimberly-Clark products being recession-proof is correct, the current recessionary pressures are of a supply-side nature.
  • Kimberly-Clark is not immune to threats to its operations due to supply issues. It needs energy, materials, transport logistics for inputs, and transport of finished goods.
  • Some of its operations may also be exposed to trade and geopolitical frictions.
  • Even though the threat of a recession seems to be rising, I decided to sell about 2/3 of my KMB stock position, in order to diversify to manage risk.

Kleenex tissues

NoDerog/iStock Unreleased via Getty Images

Investment thesis: After decades of the world being used to worrying exclusively about demand issues when it comes to economic slowdowns, we are now seeing the emergence of a new era, where supply issues are more likely

This article was written by

Zoltan Ban profile picture
My name is Zoltan Ban,  I have a BA in economics. I am a personal investor with over a decade and a half of active trading experience.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of KMB either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (13)

josephaoppenheim profile picture
Basically nonsense. Sure, it has some ups and downs, and probably is losing some market share to a resurgent PG. But as long as people pee, poop, sneeze and women bleed naturally, KMB will do well.
Jeff Stallman profile picture
51, say it out loud, FIFTY ONE! Fifty one consecutive years of increasing their dividends to investors. One would have to say KMB management must know a thing or two about recessions. This is not a growth stock, KMB is an income producing stock and when recessions hit, the dividend and its history put the brakes on any potential devastating stock price slide.
Alltime High profile picture
@Jeff Stallman FIIIIIFTY ONE :-)
Sourdough98 profile picture
@Investing for Freedom ... and about the price I would buy it at.
In Cog Neato profile picture
No company is recession-proof. One can research the companies and sectors that were most affected during past recessions.


See the last statement in the 2nd link:

"Note- No industry is truly "recession-proof industry," but there are specific industries that are more resilient during economic downturns than others."
@In Cog Neato I have held my KMB stock since 1964, despite frequent analysts’ sell recommendations. My KMB has increased more than 100 times and the dividend has been delightful. No thought of selling during yet another recession blip.
Zoltan Ban profile picture
@In Cog Neato Thank you for your comment. We should keep in mind that all the past recessions, at least since 1980s were demand-driven, not supply constraints caused. The current global economic slowdown that we are seeing, is driven by supply constraints. My argument is that it will become the new normal, therefore KMB is not necessarily the investment haven it used to be. This is not to say that there is no value in staying invested in this stock. As I pointed out in the article, there is a decent chance that it could outperform the market in the long term.
In Cog Neato profile picture
@Zoltan Ban Agreed, the sectors affected in any pullback, or recession can be shifted by the circumstances causing the pullback.
“It needs energy, materials, transport logistics for inputs, and transport of finished goods.”

as if competitors wouldn’t need all of these
Zoltan Ban profile picture
@V_uniqueacc Thank you for your comment. Yes, all competitors need all those same things. But it is not always about just beating the competitors. We are seeing the spread of regional disruptions, sectoral disruptions, and so on, due to supply constraints, which is now becoming a risk factor. The purpose of this article is to explain a perspective in regard to how this change might affect KMB. It does not mean that competitors are not potentially impacted by the same factors.
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