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Kenvue Inc KVUE

Morningstar Rating
$19.14 +0.01 (0.05%)
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Company Report

Kenvue: Talc and Cough Syrup Issues Not Material and Won't Hurt Kenvue’s Long-Term Potential

On Saturday, April 20, an Illinois judge ordered Johnson & Johnson and Kenvue to pay $45 million to a family relating to a fatal cancer from the companies’ Johnson’s baby powder. According to Bloomberg, jurors concluded that Kenvue was 70% responsible for the death, and J&J and one of its units were responsible for the remaining 30%. While action plans for both companies remain unclear, we expect Kenvue and J&J to appeal the case. Furthermore, we continue to believe that any litigation regarding talc will not affect Kenvue’s wide moat rating or $25.50 fair value estimate, given that the firm has an indemnity agreement from J&J that covers all talc-related liabilities in North America. While Kenvue remains responsible for any liability outside the US and Canada, we believe this is immaterial.

Price vs Fair Value

KVUE is trading at a 24% discount.
Price
$19.37
Fair Value
$43.20
Uncertainty
Medium
1-Star Price
$81.45
5-Star Price
$54.93
Economic Moat
Sntt
Capital Allocation
Yrwhbbbgn

Bulls Say, Bears Say

Bulls

With autonomy from its former parent, Kenvue can allocate resources to best fit its needs and grow the business.

Bears

As rising input costs put pressure on Kenvue to hike prices, consumers could start to seek cheaper options or private label offerings, hurting Kenvue’s volumes.

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News

Trading Information

Previous Close Price
$19.13
Day Range
$19.1219.29
52-Week Range
$18.0927.79
Bid/Ask
$19.15 / $19.16
Market Cap
$36.63 Bil
Volume/Avg
565 / 17.0 Mil

Key Statistics

Price/Earnings (Normalized)
13.81
Price/Sales
2.32
Dividend Yield (Trailing)
3.14%
Dividend Yield (Forward)
4.18%
Total Yield
3.14%

Company Profile

Kenvue is the world’s largest pure-play consumer health company by sales, generating $15 billion in annual revenue. Formerly known as Johnson & Johnson’s consumer segment, Kenvue spun off and went public in May 2023. It operates in a variety of silos within consumer health, such as cough, cold and allergy care, pain management, face and body care, and oral care, as well as women’s health. Its portfolio includes a wide array of some of the most well-known brands in the space, including Tylenol, Listerine, Johnson’s, Aveeno, and Neutrogena. Despite playing in a fragmented industry with intense competition and ever-changing consumer preferences, many of Kenvue’s brands are the global leader in their respective segment thanks to their strong brand power.
Sector
Consumer Defensive
Industry
Household & Personal Products
Stock Style Box
Mid Core
Total Number of Employees
22,000

Competitors

Valuation

Metric
KVUE
PG
UL
Price/Earnings (Normalized)
13.8124.8916.47
Price/Book Value
3.317.796.01
Price/Sales
2.324.781.89
Price/Cash Flow
15.1219.8314.59
Price/Earnings
KVUE
PG
UL

Financial Strength

Metric
KVUE
PG
UL
Quick Ratio
0.730.400.51
Current Ratio
1.120.640.76
Interest Coverage
6.8220.669.28
Quick Ratio
KVUE
PG
UL

Profitability

Metric
KVUE
PG
UL
Return on Assets (Normalized)
6.14%13.82%8.54%
Return on Equity (Normalized)
12.16%35.61%35.06%
Return on Invested Capital (Normalized)
9.26%20.62%13.94%
Return on Assets
KVUE
PG
UL
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CL
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EL
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KMB
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RBGLY
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CHD
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