Head-To-Head Comparison: Honest (NASDAQ:HNST) vs. Kimberly-Clark (NASDAQ:KMB)

Kimberly-Clark (NASDAQ:KMB) and Honest (NASDAQ:HNST) are both consumer staples companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, institutional ownership, profitability and earnings.

Insider and Institutional Ownership

76.3% of Kimberly-Clark shares are owned by institutional investors. Comparatively, 45.5% of Honest shares are owned by institutional investors. 0.7% of Kimberly-Clark shares are owned by insiders. Comparatively, 9.4% of Honest shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Kimberly-Clark and Honest, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kimberly-Clark	1	11	4	1	2.29
Honest	2	4	2	1	2.22

Kimberly-Clark presently has a consensus target price of $117.36, suggesting a potential upside of 18.93%. Honest has a consensus target price of $4.84, suggesting a potential downside of 10.87%. Given Kimberly-Clark’s stronger consensus rating and higher possible upside, analysts plainly believe Kimberly-Clark is more favorable than Honest.

Profitability

This table compares Kimberly-Clark and Honest’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kimberly-Clark	11.79%	143.92%	14.21%
Honest	-3.56%	4.31%	3.33%

Valuation & Earnings

This table compares Kimberly-Clark and Honest”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kimberly-Clark	$16.45 billion	2.00	$2.02 billion	$5.88	16.78
Honest	$371.32 million	1.61	-$15.69 million	($0.11)	-49.36

Kimberly-Clark has higher revenue and earnings than Honest. Honest is trading at a lower price-to-earnings ratio than Kimberly-Clark, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Kimberly-Clark has a beta of 0.25, suggesting that its stock price is 75% less volatile than the S&P 500. Comparatively, Honest has a beta of 2.24, suggesting that its stock price is 124% more volatile than the S&P 500.

Summary

Kimberly-Clark beats Honest on 12 of the 14 factors compared between the two stocks.

About Kimberly-Clark

Kimberly-Clark Corporation, together with its subsidiaries, manufactures and markets personal care and consumer tissue products in the United States. It operates through three segments: Personal Care, Consumer Tissue, and K-C Professional. The company’s Personal Care segment offers disposable diapers, training and youth pants, swimpants, baby wipes, feminine and incontinence care products, reusable underwear, and other related products under the Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Sweety, Kotex, U by Kotex, Intimus, Thinx, Poise, Depend, Plenitud, Softex, and other brand names. Its Consumer Tissue segment provides facial and bathroom tissues, paper towels, napkins, and related products under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Neve, and other brand names. The company’s K-C Professional segment offers wipers, tissues, towels, apparel, personal protective equipment, soaps, and sanitizers under the Kleenex, Scott, WypAll, Kimtech, and KleenGuard brands. It also sells household use products directly to supermarkets, mass merchandisers, drugstores, warehouse clubs, variety and department stores, and other retail outlets, as well as through other distributors and e-commerce; and away-from-home use products directly to distributors, manufacturing, lodging, office building, food service, and public facilities, as well as through e-commerce. Kimberly-Clark Corporation was founded in 1872 and is headquartered in Dallas, Texas.

About Honest

The Honest Company, Inc. manufactures and sells diapers and wipes, skin and personal care, and household and wellness products. The company also offers baby clothing and nursery bedding products. It sells its products through digital and retail sales channels, such as its website and third-party ecommerce sites, as well as brick and mortar retailers. The company was incorporated in 2012 and is headquartered in Los Angeles, California.