Gold prices bounce off 3-week lows; demand likely longer term
On Monday, Evercore ISI initiated coverage on Kenvue Inc (NYSE:KVUE), assigning the stock an "In Line" rating and establishing a price target of $25.00. According to InvestingPro data, the company commands a market capitalization of $44.55 billion and currently trades at a P/E ratio of 43.34, suggesting a premium valuation relative to its peers. The firm’s analyst highlighted the challenges faced by the company, noting that Kenvue, which was carved out from Johnson & Johnson’s Consumer division, has experienced flat sales throughout the decade ending in 2024.
The analysis by Evercore ISI pointed out that a critical aspect of Kenvue’s investment appeal is based on revitalizing its Skin Health & Beauty segment. The company aimed to achieve this through increased focus and reinvestment, supported by supply-chain savings that were realized sooner than anticipated.
Despite these efforts, Kenvue’s Skin Health & Beauty sales declined by 2% in 2024, even with a significant 20% increase in marketing expenditures. The downward trend continued into the current year, with sales dropping 4% at U.S. retail as of mid-March 2025.
The report from Evercore ISI reflects the difficulties Kenvue has encountered in trying to stimulate growth in its Skin Health & Beauty segment. The analyst’s statement underscores the impact of structural changes and the company’s struggle to translate increased marketing spend into sales growth.
Kenvue’s performance and the newly established price target by Evercore ISI will be closely watched by investors as the company strives to navigate its post-spinoff landscape and improve its key business segments. The stock currently offers a dividend yield of 3.52%. For deeper insights into Kenvue’s valuation and growth prospects, investors can access comprehensive analysis through InvestingPro, which features additional ProTips and detailed financial metrics.
In other recent news, Kenvue Inc. has announced the appointment of three new independent directors to its Board of Directors as part of a cooperation agreement with activist investor Starboard Value LP. This strategic move is aimed at enhancing growth and shareholder value. Meanwhile, Piper Sandler has raised its price target for Kenvue to $27.00, maintaining an Overweight rating, citing positive developments in the company’s Skin Health & Beauty segment. In contrast, Jefferies has adjusted its price target to $26.00 from $27.00, while maintaining a Buy rating, reflecting confidence in Kenvue’s ongoing transformation efforts.
William Blair has reaffirmed a Market Perform rating on Kenvue, noting that while organic sales growth was below expectations, the company has made significant progress in cost savings and operational efficiency through its Vue Forward program. The analyst also highlighted Kenvue’s innovation and distribution gains as positive factors for future sales growth. Additionally, Starboard Value has nominated four directors to Kenvue’s board, emphasizing the need for accountability and measures that prioritize stockholders’ interests.
These developments come as Kenvue focuses on strategic initiatives to improve its financial performance and market position. The cooperation agreement with Starboard and the board nominations are part of efforts to unlock the company’s potential. Kenvue’s management has expressed confidence in its strategies, despite some anticipated disruptions in the first half of the year, with optimism for improved performance in the second half.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.