Kimberly Clark (KMB-N)

They delivered an okay quarter. The dividend is 3.5%. You can buy this and put it away while collecting the 3.5. Investors hate these stocks now, like Clorox, though he likes them.

Has been volatile this year and their last report missed Management is fine. They face price wars with P&G all the time, and P&G is bigger. KMB is okay if you collected the 3.13% dividend.

This has a remarkably consistent and remarkably high ROC in about the 12% range. He would have expected it to be lower. Valuation may be a little bit rich, but not at the point where he would be getting out.

UFS-N vs. KMB-N. UFS-N has a nice balance sheet that is well protected and a dividend north of 4%. It is a well run company with a defensible market share when you look at some of the fast growth markets they have been trying to address like Asia. They have been keen to ramp up their exports to Asia. He would refer UFS-N at these valuations.

Very consistent, improving return on capital up to 12%. It is a good time to get into it. It is a little rich, however.

Over the last couple of years, they have been working hard on the internal workings of their business. Have been reorganizing, cutting costs and rationalizing. This is as a result that their business is a slow growth one. Thinks they have done a good job in terms of reorganizing. The difficulty is not with what management has done, but is the price that the market is looking for him to pay, close to 20X earnings. He doesn’t understand why a slow growth company like this would demand a 20 multiple.

Great company and wonderful brands. Spinning off their healthcare division, and doing so at a wonderful valuation. Going to have a lot of cash which he sees as being used for share buybacks. This is a company with which you can sleep well at night. If it fell off 5%-10% more, it would be one he would consider.

Has a model price of $93.12, a negative 12%. If there was to be any pullback, certainly to the $84 level, he would be a Buyer. You could buy half a position now and hope for cheaper prices to get the balance.