Activist Investor Starboard Value Targets Kenvue, Parent Company of Tylenol and Listerine

Activist Investor Starboard Value Targets Kenvue, Parent Company of Tylenol and Listerine

Get ready for some potential shakeups in the consumer goods sector. Starboard Value, a well-known activist investor, has reportedly taken a substantial stake in Kenvue Inc., the company responsible for household names like Tylenol, Listerine, and a host of other popular brands.

This move signals that Starboard is pushing for changes at Kenvue, which was spun off from Johnson & Johnson just last year. Kenvue boasts a market value of over $40 billion, but despite having some of the biggest names in the consumer goods industry, its stock has underperformed compared to its peers and the broader market since its debut.

While the exact size of Starboard’s stake and their specific plans for Kenvue remain under wraps, the news has sent ripples through the market. Starboard’s founder and CEO, Jeff Smith, is set to unveil the firm’s strategy for Kenvue at an activist investing conference in New York on Tuesday.

Among Kenvue’s other well-known brands are Aveeno, Band-Aid, Zyrtec, Neosporin, and Neutrogena. The company, led by CEO Thibaut Mongon, generated over $15 billion in net sales in 2023.

Kenvue’s stock price has remained relatively flat this year, a stark contrast to the S&P 500 index’s impressive 23% increase. The company faces stiff competition from other consumer goods giants like Haleon (parent company of Advil), Procter & Gamble (owner of Pepto-Bismol), and Unilever (maker of Axe deodorant).

Starboard’s recent investment in Kenvue follows its acquisition of a roughly $1 billion stake in Pfizer Inc., where it’s seeking changes to boost the drugmaker’s performance. This includes the appointment of former Pfizer executives Ian Read and Frank D’Amelio, who have pledged support for current CEO Albert Bourla.

Starboard has a reputation for actively engaging in various sectors, including technology, where it has recently been involved with companies like Salesforce, Autodesk, and Match Group.

Kenvue Inc.’s stock closed at $21.72 on Friday, up 1.26% for the day. While the stock has shown a slight increase year-to-date, it remains to be seen if Starboard’s involvement will lead to the significant changes needed to boost Kenvue’s performance and attract investors.

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