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Investing.com - Jefferies lowered its price target on Kenvue Inc (NYSE:KVUE) to $25.00 from $26.00 on Friday, while maintaining a Buy rating on the consumer health company’s stock. The $41.78 billion market cap company currently trades at a P/E ratio of 29x, with analyst targets ranging from $20 to $26.
The price target reduction follows Kenvue’s guidance revision, which Jefferies interpreted as signaling a "tougher road ahead" for the company in 2025, with expectations for softer top-line performance and margin compression. According to InvestingPro, the company maintains impressive gross profit margins of 58.24%, though revenue growth has been challenging at -1.19% over the last twelve months.
Despite the near-term challenges, Jefferies continues to see significant value potential in Kenvue’s portfolio, citing the company’s recognizable brands positioned in attractive categories.
The research firm emphasized that increased reinvestment will be crucial for Kenvue to drive growth turnarounds in its business segments.
Jefferies noted uncertainty regarding the timeline for when these reinvestment benefits might begin to materialize and positively impact the company’s performance.
In other recent news, Kenvue Inc. reported its second-quarter 2025 earnings, revealing an adjusted diluted earnings per share of $0.29, which did not meet the forecasted $0.35. The company also fell short of revenue expectations, reporting $3.84 billion compared to an anticipated $4.18 billion. Additionally, Kenvue experienced a 4.0% decline in sales for the quarter, with organic sales down 4.2%, attributed to weaker consumption, trade inventory fluctuations, and increased promotional activity. Following these results, Canaccord Genuity lowered its price target for Kenvue to $26.00 from $29.00 but maintained a Buy rating on the stock. These recent developments reflect the challenges Kenvue is facing across its business segments.
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