10 Undervalued Dividend Aristocrats to Buy According to Hedge Funds

4. Kimberly-Clark Corporation (NYSE:KMB)

Dividend Yield as of December 23: ​​3.72%

Number of Hedge Fund Holders: 45

P/E Ratio: 17.01

Kimberly-Clark Corporation (NYSE:KMB), founded in 1872 and headquartered in Dallas, Texas, manufactures and markets personal care and consumer tissue products. The company operates through three segments – Personal Care, Consumer Tissue, and K-C Professional. Consumer demand for premium products continues to grow across developed and emerging markets, supported by trends like aging populations driving adult care. This positions KMB as one of the best dividend aristocrat stocks to buy.

Kimberly-Clark Corporation (NYSE:KMB)’s gross margins have consistently improved over the past eight quarters, averaging 37% for the year. The company remains confident in achieving its long-term goal of at least 40% gross margin and operating margins between 18-20% by the end of the decade. Kimberly-Clark Corporation (NYSE:KMB) reported third-quarter sales of $5.0 billion, which was 4% lower than the same period last year. This drop was mainly due to a 3% hit from unfavorable currency exchange rates and a 1% impact from selling off their PPE business in July.

Looking ahead, Kimberly-Clark Corporation (NYSE:KMB) anticipates stronger Q4 performance, with stepped-up investments in advertising and brand support. The company expects top-line growth to improve, driven by a volume mix-led strategy while navigating one-time and external factors. Despite these challenges, Kimberly-Clark is making steady progress on margins and remains committed to long-term growth.

So far this year, Kimberly-Clark Corporation (NYSE:KMB) generated $2.4 billion in cash from operations, up from $2.3 billion last year, mainly due to improved operating performance. The company returned $2.0 billion to shareholders through dividends and stock buybacks. Total debt was reduced to $7.5 billion as of September 30, 2024, from $8.0 billion at the end of 2023. Kimberly-Clark Corporation (NYSE:KMB)’s board of directors announced a quarterly dividend of $1.22 per share, payable on January 3, 2025, to shareholders on record as of December 6, 2024. This marks the company’s 90th consecutive year of paying dividends and the 52nd straight year of increasing them.

Insider Monkey’s Q3 data shows that 45 hedge funds were bullish on Kimberly-Clark Corporation (NYSE:KMB), compared to 43 funds in the prior quarter. D E Shaw is the leading stakeholder of the company, with 1.28 million shares worth $182.35 million.