5 Recent Spin-off Companies That Hedge Funds Are Piling Into

1. Kenvue Inc. (NYSE:KVUE)

Number of Hedge Fund Holders: 84

Kenvue Inc. (NYSE:KVUE) was founded as an independent company after Johnson & Johnson (NYSE:JNJ) spun off its consumer health unit in August 2023. 

On December 13, Citi raised the price target on Kenvue Inc. (NYSE:KVUE)’s stock to $23 from $21 and maintained a Neutral rating.

According to Insider Monkey’s database, the hedge fund sentiment was quite positive toward Kenvue Inc. (NYSE:KVUE). In the third quarter, 84 hedge funds were bullish on the stock with a total stake value of $3.37 billion, compared to 31 funds with a combined stake value of $734.446 million in the previous quarter.

Mayar Capital commented on Kenvue Inc. (NYSE:KVUE) in its third quarter 2023 investor letter. Here is what it said:

“We also initiated a new investment in the shares of Kenvue Inc. (NYSE:KVUE). In August, Johnson & Johnson completed the split-off from Kenvue in which J&J shareholders could tender their shares in exchange for Kenvue shares at a 7% discount. Kenvue is formerly the J&J Consumer Health business. The transaction makes sense – the Consumer division was always small for J&J and this separation gives investors two distinct options, one pure-play FMCG company, and one pure-play healthcare company. We like Kenvue’s strong brand portfolio across its OTC medication business as well as its beauty and other healthcare brands (such as Listerine and Johnson’s), and the company has some very strong positions in its niches. While this isn’t a fast-grower, the manufacturing scale, IP and distribution network of this business provide a deep enough moat to give reasonable assurances about the company’s quality. And the current valuation looks attractive.”

You can also look at the 13 Cheap Penny Stocks to Buy According to Hedge Funds and the 12 Best Gold Stocks With Dividends.

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