RBC Capital has upheld its Sector Perform rating on Kenvue Inc (NYSE:KVUE), setting a price target of $21.00 per share, which suggests an 18% increase from its trading price of $17.75. Kenvue's scheduled earnings release on February 5 remains a focal point for investors.
The research team at RBC foresees a subdued quarter for the consumer health company, mainly owing to a challenging market backdrop combined with competitive pressures on core products such as Tylenol and offerings in the Skin Health & Beauty segment.
Despite these headwinds, RBC highlights potential upside from easier comparisons to a milder U.S. cold and flu season in the preceding year, as well as temporary disturbances in the Asia-Pacific region that affected prior results.
Although there was a noted rise in flu season activity towards the latter part of the quarter, RBC cautions that this likely will not translate into significant gains since the increase was relatively late in the reporting period.
Looking beyond the immediate quarter, RBC characterizes current growth forecasts as reasonable but anticipates possible "modest downside" in earnings per share, primarily attributable to the need for reinvestment within the business. This expectation underpins a forecast of rangebound trading for Kenvue shares, given ongoing deal dynamics.
In parallel developments, Kimberly-Clark recently announced its intention to acquire Kenvue in a transaction combining cash and stock, valued at approximately $48.7 billion. Under this arrangement, Kenvue shareholders will receive $3.50 per share in cash and 0.14625 Kimberly-Clark shares for every Kenvue share held. Based on Kimberly-Clark's closing price on October 31, this deal equates to an effective total of $21.01 per Kenvue share.
Post-transaction, Kimberly-Clark shareholders are expected to hold around 54% ownership of the newly combined company, with former Kenvue shareholders owning the remaining 46%. This acquisition reportedly alleviates concerns held by activist hedge funds with significant stakes in Kenvue, who had faced potential losses following a nearly 22% decline in Kenvue's stock prior to the deal announcement.
Meanwhile, U.S. Health Secretary Robert F. Kennedy Jr. weighed in on ongoing discussions about Kenvue's Tylenol, noting that although the causal link to autism is not definitively established, exercising caution remains advisable.
Additionally, Kenvue declared a quarterly dividend payment of $0.2075 per share, with a payout date set for November 26, 2025, to shareholders recorded as of November 12, 2025.
These developments collectively underscore a period of significant transition and highlight critical considerations for stakeholders in both Kimberly-Clark and Kenvue.