Without a doubt, this tumultuous time will be remembered for the run on toilet paper, and the empty shelves, and this company should be a big winner. Kimberly-Clark Corp. (NYSE: KMB) is a manufacturer of tissue, personal care, and health care products. Global brands include Huggies, Kotex, Kleenex, Cottonelle, Viva, Scott, Depend and Poise, as well as Andrex in the United Kingdom.
In addition to the concerns over shortages of products, the company also looks poised to benefit from a longer and more severe allergy season expected this year, particularly in the eastern United States, due to warmer temperatures and above-average rainfall. The company also raised its dividend for 2020 by 3.9% to $1.07 per share.
The dividend increase now means a tempting 3.18% yield. The $155 Merrill Lynch price objective is above the $141.15 consensus price target. Kimberly-Clark stock closed at $134.35 on Wednesday after retreating almost 7%.
This top grocer does almost all its business in the United States, and it is desperately trying to hire more workers to keep up with demand. Kroger Co. (NYSE: KR) is the second-largest U.S. food supermarket retailer and generates $120 billion in annual sales. Kroger operates roughly 2,800 supermarkets throughout 35 states and under two dozen banners. Kroger also sells fuel at 1,450 supermarket fuel centers and operates 2,268 pharmacies and 274 jewelry stores.
Analysts note that the company’s price leadership, strong management team, store execution and impressive leveraging of technology partnerships and investments (including a recently announced partnership with Ocado) should support Kroger’s revenue outlook and help drive efficiency.
Shareholders are paid a 1.88% dividend. Merrill Lynch has set a $37 price target. The posted consensus target is $33.22, and Kroger stock closed Wednesday at $33.91. That was just shy of a 3% gain for the day.
Procter & Gamble
The stock offers a very solid dividend and safety. Procter & Gamble Co. (NYSE: PG) is one of the world’s largest consumer products companies, and it operates in five segments: Beauty, Grooming, Health Care, Fabric & Home Care, and Baby & Family Care. Its many brands include Pampers, Tide, Bounty, Charmin, Gillette, Oral B, Crest, Olay, Pantene, Head & Shoulders, Ariel, Gain, Always, Tampax, Downy and Dawn. Some of these are among the most valuable brands in the world.
The company actually is innovative in its product development process and uses that to help ensure future growth and cash flow. This should provide investors years of steady growth and dividends, plus a safe place to roost now given the extreme volatility.
Shareholders receive a 2.53% dividend. The Merrill Lynch price objective is $140 and the analysts’ consensus target is $129.05. Procter & Gamble stock closed most recently at $117.45 per share.
The key for investors looking to add these top stocks to portfolios is to scale buy shares, rather than buying a large position all at once. While the coronavirus scare is similar to past health-related events, we still don’t know how things will play out, so better to be safe rather than sorry. With that said, these companies are benefiting and should continue to, for at least the short term, and most likely the long term as well.
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