Jim Cramer’s charitable trust to increase position in Kimberly-Clark — CNBC
Jim Cramer’s charitable trust plans to buy 100 shares of personal care products manufacturer Kimberly-Clark at approximately $98 per share. After Friday’s transaction, the trust will own 465 shares of the company, and its portfolio weighting will increase from 0.9% to 1.15%, CNBC reports.
Results warning
Kimberly-Clark shares have gone through a difficult period since the trust opened its position at the beginning of the month. The situation was worsened by the company’s warning at a conference last week: third-quarter sales and earnings per share were expected to be below analysts’ forecasts.
Some of the problems, according to management, are related to timing. The company poorly executed a product innovation and postponed its launch because of manufacturing difficulties. Distributors were also reducing inventories in the professional sales channel.
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Expectations from Kenvue
Kimberly-Clark’s financial results are also being affected by higher freight and logistics costs, as well as retaliatory tariffs related to China. Huggies diaper sales in China remain weak because of false claims about product quality.
At the same time, the trust is counting on the potential of the planned acquisition of Kenvue, whose brand portfolio includes Tylenol and Band-Aid. Kimberly-Clark said that synergy planning is ahead of expectations, while executives expressed confidence in the integration. Potential growth from this deal was the reason for increasing the position despite the company’s current weak performance.
