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Kenvue struggles with many ailments.
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The company has a new management team to help turn things around.
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Several catalysts could drive the recovery in the coming years.
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10 Stocks We Like More Than Kenvue ›
Kenwoo (NYSE: KVUE) not a household name. The consumer health products company has only been around for a couple of years in its current form. But while you may not know the name Kenvue, you’ve probably heard of some of its many products, which include Band-Aid, Listerine, and Tylenol.
Shares of the consumer goods company have fallen more than 20% this year amid a range of issues, including concerns over Tylenol’s link to autism. That decline pushed the dividend yield to over 5%.
Although Kenvue’s stock has fallen this year, it could rise in 2026. Here are some of the catalysts that could lead to a recovery for the consumer healthcare company.
Kenvue began to form in 2022. at the end when Johnson & Johnson (NYSE: JNJ) introduced a new name for the former consumer healthcare business, which it restructured into a separate joint-stock company. The name comes from the words “ken” meaning knowledge and “vue” meaning sight. in 2023 Johnson & Johnson finally completed its initial public offering (IPO). Later that year, the companies officially separated when Johnson & Johnson made an exchange offer with its shareholders, giving them control of the newly independent company.
Kenvue is one of the world’s largest consumer healthcare products companies. It owns a portfolio of leading consumer healthcare product brands focused on self-care (such as Tylenol and Band-Aid), skin health and beauty (such as Aveeno and Neutrogena), and basic health (such as Listerine). Last year, the company reported sales of $15.5 billion and posted a profit of more than $1 billion.
While Kenvue owns a global portfolio of iconic consumer healthcare products, innovation is part of its DNA. From 2020 more than 100 new product innovations are introduced every year.
Johnson & Johnson believed that Kenvue could thrive as a stand-alone company. The business has delivered solid organic revenue growth as more and more consumers around the world have come to rely on its consumer health products in their daily lives. Johnson & Johnson hoped that Kenvue would increase profit margins because the independent company could operate more efficiently. Meanwhile, an independent Kenvue would have more flexibility to make acquisitions to further enhance its global portfolio and growth profile.
Unfortunately, things didn’t work out that way. Kenvue has struggled to grow sales (flat last year and 4% in Q2 2025). Meanwhile, instead of increasing profit margins, its revenue has declined due to higher costs and other factors.
The situation worsened this year after the Trump administration linked Tylenol use by expectant mothers to autism and attention deficit/hyperactivity disorder. These concerns weighed heavily on stocks.
Kenvue’s problems have attracted the attention of activist investors. Starboard Value led the company to make changes, which it did by revamping the board and bringing in a new senior management team. The company hired a new CFO in May and a new interim CEO a couple of months later.
The new management team, together with advisors, is looking for strategic alternatives for the company. These opportunities could include optimizing the brand portfolio and improving performance to drive growth, as well as other initiatives to unlock shareholder value. One of the things the company is considering is selling or spinning off its skin health business.
Selling shares of a company can unlock shareholder value. For example, analysts believe the skin health and beauty division could be worth between $6 billion and $9 billion. A sale of that unit to a rival consumer health product company or private equity fund would give it cash to shore up its balance sheet and potentially facilitate acquisitions to bolster the rest of the business. A sale of this unit at the high end of that range could add significantly to Kenvue’s share price.
Meanwhile, tangible actions to boost growth and increase its profitability would also boost the stock in the coming years. Additionally, positive news about Tylenol would also be a major catalyst.
Kenvue had a rocky start as an independent public company. But activist investors pushed for change, resulting in a revamped board, a new senior management team and a renewed strategic focus on unlocking value. These moves could help spur a rebound in the share price next year. This growth potential makes Kenvue a tempting candidate. In the meantime, investors will be well-paid while they wait for the company to execute its turnaround strategy.
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Matt DiLallo holds positions at Johnson & Johnson and Kenvue and has the following options: Short 2025 in december $16 for Kenvue. The Motley Fool has a position and recommends Kenvue. The Motley Fool recommends Johnson & Johnson and recommends the following options: Long 2026 January $13 calls to Kenvue. The Motley Fool has a disclosure policy.
The Motley Fool originally issued a 5% dividend yield for the stock, which could climb through 2026.
