Kenvue Inc. (KVUE): A Bull Case Theory

We came across a bullish thesis on Kenvue Inc. on X.com by ZeeContrarian1. In this article, we will summarize the bulls’ thesis on KVUE. Kenvue Inc.'s share was trading at $16.23 as of September 30th. KVUE’s trailing and forward P/E were 21.89 and 14.81 respectively according to Yahoo Finance.

Donald Trump, despite having no medical background, has once again made headlines with controversial health advice, this time targeting prenatal care. He claimed that taking acetaminophen, the active ingredient in Tylenol, during pregnancy could cause autism and urged expectant mothers to “fight like hell” to avoid it. These statements stand in stark contrast to over a century of research showing acetaminophen as one of the safest and most widely used pain relievers, particularly during pregnancy when alternatives like ibuprofen are often discouraged after 20 weeks.

Medical experts quickly criticized Trump’s comments as reckless, emphasizing that untreated pain or fever in pregnancy can pose real risks to both mother and child. Even political figures like JD Vance refrained from repeating the claims, instead advising women to follow their doctors’ guidance. The market reaction was immediate and severe, with shares of Kenvue ($KVUE), Tylenol’s manufacturer, falling roughly 10% to new all-time lows.

At current levels, the stock trades around 12x 2028 earnings, a nearly 46% discount to consumer staples peers at approximately 17.5x. This disconnect between the company’s long-standing safety record and the market’s reaction has created a potential buying opportunity. Given the strong fundamentals, wide consumer reach, and proven safety profile of acetaminophen, accumulating shares on this weakness offers an attractive risk/reward scenario. While headlines may generate short-term volatility, the long-term outlook for Kenvue remains solid, and the market appears to have overreacted to unfounded claims, presenting investors with a chance to capture value at a compelling entry point.

Previously we covered a bullish thesis on e.l.f. Beauty, Inc. (ELF) by Fierce__beast in November 2024, which highlighted the company’s strong e-commerce growth, international expansion, and strategic acquisitions like Naturium. The company's stock price has appreciated approximately by 8% since our coverage. This is because the thesis partly played out amid sector volatility. The thesis still stands as ELF’s long-term fundamentals remain robust. ZeeContrarian1 shares a similar opportunistic perspective but emphasizes Kenvue’s undervaluation after market overreaction, presenting a compelling buying opportunity.

Kenvue Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 72 hedge fund portfolios held KVUE at the end of the second quarter which was 52 in the previous quarter. While we acknowledge the potential of KVUE as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.