Can Premiumization Keep KMB Growing Ahead of Category Trends?

Kimberly-Clark Corporation's KMB third-quarter 2025 performance suggests that premiumization can continue to support growth ahead of generally modest category trends. Management reported a seventh consecutive quarter of volume-plus-mix-led growth, highlighting the company’s ability to outperform categories that remain pressured by muted demand and demographic headwinds.

This premiumization strategy is already delivering measurable results across key markets. In North America, premium products have increased from about 40% of the business a decade ago to just under 70% today, reflecting sustained consumer trade-up. In China, the shift has been even more pronounced, with premium mix rising from roughly 6% five years ago to well over 40%, underscoring premiumization as a core, scalable growth strategy for Kimberly-Clark.

Importantly, the company is pairing premium growth with strengthened value offerings. Innovations are being cascaded into mainstream tiers, improving softness, comfort and protection while preserving affordability. This balanced architecture allows KMB to defend volumes among value-seeking consumers while still driving positive mix, even amid increased private-label and promotional pressure.

Channel dynamics further support the strategy. Management noted strong growth in e-commerce and club channels, where KMB’s premium mix and share are higher than in traditional retail. Promotions are being used selectively to drive trials of innovation, rather than to fuel price wars, helping protect brand equity and long-term profitability.

Overall, Kimberly-Clark’s results suggest that premiumization, when combined with disciplined value offerings and channel execution, can enable it to grow at or ahead of category trends. The company’s consistent volume-plus-mix performance indicates that premium-led growth remains a durable competitive advantage rather than a short-term tailwind.

Kimberly-Clark’s Price Performance, Valuation & Estimates

KMB, which competes with Procter & Gamble PG and Albertsons Companies ACI, has seen its shares decline 20.2% in the past six months compared with the industry’s fall of 11.9%. Also, shares of Procter & Gamble and Albertsons Companies have lost 8.4% and 18.1%, respectively, in the aforementioned period.

Kimberly-Clark’s forward 12-month price-to-earnings ratio of 14.56 reflects a lower valuation than the industry’s average of 17.98. KMB has a Value Score of C. KMB is trading at a discount to Procter & Gamble (with a forward 12-month P/E ratio of 20.20) and at a premium to Albertsons Companies (7.80).

The Zacks Consensus Estimate for KMB’s 2025 earnings implies a year-over-year decline of 16.4%, while the same for 2026 indicates growth of 16.4%. Earnings estimates for 2025 have been southbound by 12 cents per share, while the same for 2026 have been northbound by 5 cents in the past 30 days.

Kimberly-Clark currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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