Hedge Fund Pushes for Strategic Changes at Band-Aid, Listerine, and Tylenol Maker
Kenvue’s Stock Performance Under Scrutiny
Hedge fund Starboard Value has taken a stake in Kenvue, a major consumer products company known for its iconic brands such as Band-Aid, Listerine, and Tylenol, according to sources familiar with the matter. The New Jersey-based company, which was spun off from Johnson & Johnson and went public in May 2023, has faced financial challenges since its initial public offering (IPO). Kenvue’s stock price has fallen by 18% since it began trading publicly, closing at $21.72 per share last Friday, giving the company a market capitalization of $41 billion.
Starboard’s move comes at a time when the hedge fund appears to be interested in urging Kenvue to reevaluate its brand positioning and pricing strategies to improve its overall performance. Although details about the exact size of Starboard’s investment remain unclear, sources suggest that the hedge fund is closely watching how the company manages its portfolio of household-name products. Kenvue, however, has yet to comment on Starboard’s new involvement.
Strategic Pressures Ahead for Kenvue
Kenvue’s status as a former Johnson & Johnson subsidiary gives it a well-established portfolio, but Kenvue’s stock market performance has been underwhelming since its public debut. Starboard, known for taking active roles in guiding corporate strategies, could push for a restructuring or shift in how Kenvue approaches its pricing and brand management to better compete in the consumer health and wellness space.
This development comes just days before Starboard’s Chief Investment Officer, Jeffrey Smith, is scheduled to present investment strategies at the 13D Monitor Active-Passive Investor Summit, where the hedge fund’s influence on key corporations is expected to be discussed. While Kenvue has remained silent on the recent acquisition, the company’s leadership will likely face increasing pressure to respond and clarify how it plans to navigate these challenges.
Starboard’s Broader Investment Moves
The news of Starboard’s investment in Kenvue follows other recent moves by the hedge fund to influence major players in the pharmaceutical and consumer goods sectors. Starboard is also reportedly preparing to discuss its new $1 billion investment in Pfizer, the pharmaceutical company behind the world’s first COVID-19 vaccine. Pfizer, like Kenvue, has faced its own stock value decline in recent years.
Just last week, Starboard’s Jeffrey Smith held discussions with Pfizer CEO Albert Bourla and the company’s lead independent director. With Pfizer’s stock having lost nearly half its value since its 2021 peak, Starboard is expected to push for enhanced financial performance from the pharmaceutical giant, similar to its plans for Kenvue. Both moves suggest Starboard’s broader strategy of targeting large, well-known companies that have seen dips in stock value and are in need of strategic revitalization.
As these developments unfold, all eyes will be on how Kenvue and Pfizer respond to Starboard’s influence and whether the hedge fund’s involvement can drive meaningful changes in both companies’ financial trajectories.
