10 Best Young Stocks To Buy Now

2. Kenvue Inc. (NYSE:KVUE)

Market Cap as of September 26: $44.12 billion

Number of Hedge Fund Holders: 58

Kenvue Inc. (NYSE:KVUE) is a consumer health company. Formerly the Consumer Healthcare division of Johnson & Johnson, it is the proprietor of well-known brands such as Aveeno, Band-Aid, Benadryl, Combantrin, Zyrtec, Johnson’s, Listerine, Mylanta, Neutrogena, Trosyd, Tylenol, and Visine. It focuses on providing essential health and wellness products to consumers around the world.

In the second quarter of 2024, the company generated $4 billion in revenue, down 0.27% from the year-ago period. China’s soft market hurt Dr.Ci:Labo brand to drive some of this drop.

Self-care growth slowed to flat year-over-year, following a 14.2% increase last year, although the company outperformed the global market for the 8th consecutive quarter. Tylenol’s market share grew, widening the gap with competitors. Consumer innovations like Tylenol Easy to Swallow benefited from increased investments. Allergy sales recovered in June.

Kenvue Inc. (NYSE:KVUE) expanded its in-store presence and increased media drove growth. Essential Health grew 7.6% organically, with balanced value and volume growth. Listerine grew 10% globally. Increased marketing investment drove returns for Listerine, despite strong clinical superiority.

Kenvue Inc.’s (NYSE:KVUE) performance was solid, with organic growth at 1.5%, driven by value realization across all segments and volume growth in Essential Health. Value realization contributed 2.1% to growth. Volume declined slightly in Self Care and Skin Health and Beauty. Even with volume growth somewhat constrained (down 0.6% year-over-year), the company’s strategic initiatives and strong financial performance positioned it well for future growth.

Oakmark Fund stated the following regarding Kenvue Inc. (NYSE:KVUE) in its first quarter 2024 investor letter:

“Kenvue Inc. (NYSE:KVUE) became the largest standalone consumer health company following its split-off from Johnson & Johnson in May 2023. The company’s highly recognizable brands, such as Neutrogena, Listerine, Tylenol and Band-Aid, have been market share leaders in their respective categories for generations. However, Kenvue’s first year as a public company was clouded by litigation and market share losses in certain categories. As a result, Kenvue now trades for just 16.5x trailing earnings, a substantial discount to the market and other consumer health and packaged goods companies. We see an opportunity for the company to improve efficiency and re-invest the cost savings into increased product development and marketing, which should help improve its growth and brand equity.”