KMB

[Rasec]

Has anyone been following KMB for long enough that can help me understand what happened in Q3 2015? The P/E is ridiculously high but the stock price kept going up from that moment on.

P/E



Price



It raised my attention because it's an aristocrat and it was down roughly 3% this morning.

[EricL]

The second quarter saw a $1.322 billion charge due to pension settlements that resulted in a net income of -$0.83 for the quarter. Adjusted earnings were $1.41, which is why you saw the spike in PE calculated with reported earnings. This compares with a 21.4 PE based on adjusted earnings of $5.76.

In short, what you are seeing is the difference between GAAP and non-GAAP earnings being used to calculate the PE.

[Rasec]

Thanks Eric. Great explanation.