Kenvue A new name for an iconic consumer health company

what is kenvue

The figure for the period from January to September 2023 is very low, but it could be that R&D spending is weighted towards the end of this year. In any case, investors and those interested in investing in KVUE stock should keep an eye on this figure as it could indicate a lack of innovation. However, at the same time, an increase in the coming years could indicate underinvestment when Kenvue was still part of JNJ, and would thus suggest an improvement as the company can now freely allocate its resources.

what is kenvue

Formerly the Consumer Healthcare division of Johnson & Johnson,[2] Kenvue is the proprietor of well-known brands such as Aveeno,[3] Band-Aid,[4] Benadryl, Zyrtec,[5] Johnson’s,[6] Listerine,[7] Mylanta, Neutrogena,[3] Tylenol,[7] and Visine. To give its consumer health business the agility to https://www.day-trading.info/ better innovate and grow across its categories, Johnson & Johnson was planning to create two standalone companies. The other needed a new corporate name—one that would build on its rich history of innovation and consumer focus, while providing the scalability to evolve boldly into the future.

We’ve always believed in the power of new perspectives and insights to drive innovation. That’s why our iconic brands have helped generations take care of themselves and their loved ones for more than 135 years. Our Healthy Lives Mission strives to advance the well-being of both your health and the planet’s health.

Carlton Lawson

And if there’s anything I should improve or expand on in future articles, drop me a line as well. https://www.forexbox.info/ As always, please consider this article only as a first step in your own due diligence.

what is kenvue

The interest coverage ratio is approximately 7.8 times the expected free cash flow before interest payments, although it should be noted that this figure does not include interest income for reasons of prudence (KVUE had cash and cash equivalents of $1.1 billion at the end of the third quarter). For its first year as a standalone company, analysts currently expect EPS of $1.26 and net sales of $15.6 billion. If we use JNJ’s former Consumer Health segment for comparison – for which net sales data is readily available in JNJ’s 10-Ks – we see that analysts expect sales growth of 4.1% for 2023.

Executive management

Paul Ruh, J&J’s chief financial officer of consumer health and a former PepsiCo executive, will serve as CFO, and Meredith Stevens, J&J’s worldwide vice president of the company’s consumer health supply chain department, will serve as COO. However, the potential https://www.forex-world.net/ underinvestment should not necessarily be interpreted as a sign of poor profitability or a weak balance sheet (i.e., a need to cut costs). The company could most certainly repay all of its debt on maturity and would not even have to suspend its dividend.

  1. That decision was part of J&J’s second attempt to settle talc claims in bankruptcy proceedings.
  2. We are committed to continuously improving our sustainability efforts through our brands, packaging and operations, delivering on the expectations of today’s consumers.
  3. We’ve always prioritized science as the core of how we provide care, and this will never change.
  4. I consider the adjustment for the former in particular to be very important, as Johnson & Johnson retains the majority of talc-related claims (detailed analysis here) – Kenvue will only be responsible for claims outside the US or Canada.
  5. Skin health and beauty products accounted for $4.4 billion in net sales last year, or 29% of overall revenue.

In May 2023, Kenvue made our debut as a public company on the New York Stock Exchange, trading under the KVUE ticker symbol. Today, Kenvue is the world’s largest pure-play consumer health company by revenue, with annual sales of ~$15 billion in 2022. If you’ve heard of Kenvue, you may already know that we’re a global consumer health company.

Celebrating Black History Month: How these Kenvue initiatives support diversity and health equity

I consider the adjustment for the former in particular to be very important, as Johnson & Johnson retains the majority of talc-related claims (detailed analysis here) – Kenvue will only be responsible for claims outside the US or Canada. Kenvue was officially announced in September 2022, poising this world leader in consumer health for exciting growth as it forges ahead in its planned next chapter as a standalone company. From gently cleaning tiny fingers during a baby’s first bath to protecting the vitality of your skin to soothing aches and pains — our products deliver safe, effective, everyday care at every stage of life.

When Does Kenvue Report Q4 Earnings?

With leading science and knowledge, we educate and empower — so that when people need us, they can rely on our brands. However, despite the restructuring in recent years and an in principle solid foundation, I think it is worth keeping an eye on Kenvue’s research and development (R&D) spending in the context of relatively weak long-term sales growth. JNJ’s Consumer Health segment has seen some margin expansion in recent years (Figure 4), but of course there is still room for improvement, especially in terms of cash profitability (estimated free cash flow margin of 17%). Note that I have adjusted the profit figures used in the calculation for litigation-related expenses and gains from divestitures.

Kenvue’s chief people officer, chief corporate affairs officer, chief technology and data officer, chief scientific officer and group presidents for different regions around the world are also from J&J. Skin health and beauty products accounted for $4.4 billion in net sales last year, or 29% of overall revenue. Among those products are shampoos, conditioners, hair loss treatments and skin care. Annual sales growth through 2025 is projected to be about 3% to 4% globally, according to the filing. Until then, Kenvue will qualify as a “controlled company” under the corporate governance rules of the NYSE, the filing said. That will allow Kenvue to avoid certain listing standards, including a requirement that the company’s board be composed of a majority of independent directors.

But beyond our portfolio of iconic brands, Kenvue is built on a foundation of core values, which fuel our 22,000+ global team members every day. Of course, given Kenvue’s very limited history, it is impossible to say whether estimates are likely to be beaten. However, considering that CEO Mongon has been with the parent company for 23 years and has led the former Consumer Health segment since 2019, I view JNJ’s tradition of at least meeting estimates as a reasonable expectation for Kenvue. In addition, its recession-resistant business model and low demand volatility contribute their fair share to what I believe could become a “sleep well at night” company.

We’ve always prioritized science as the core of how we provide care, and this will never change. Each of the three divisions was profitable on an adjusted operating income basis, the company said in the filing. Overall, Kenvue said 2022 sales were “well balanced” across the company’s three business divisions. “Johnson & Johnson will continue to control the direction of our business, and the concentrated ownership of our common stock may prevent you and other shareholders from influencing significant decisions,” Kenvue said in the filing. Meanwhile, Kenvue is chock full of household names familiar to investors and the larger public, such as Tylenol, Band-Aid, Listerine, Aveeno, Neutrogena, and J&J’s namesake baby powder and shampoo. The company expected to price 151 million shares between $20 and $23 per share, according to a preliminary prospectus it filed with the Securities and Exchange Commission last week.

J&J will generally be able to control matters that shareholders vote on, such as the election of directors to Kenvue’s board, the filing said. The spinoff, the biggest IPO since EV maker Rivian went public in November 2021, alone may not completely turn around the moribund IPO market, which plummeted in 2022. Whether you agree or disagree with my conclusions, I always welcome your opinion and feedback in the comments below.

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