Why Is Consumer Health Firm Kenvue Stock Trading Lower Today?

Thursday, Kenvue Inc’s KVUE fourth-quarter 2023 sales decreased 2.7% vs a 0.9% increase in the prior year to $3.67 billion, missing the consensus of $3.78 billion.

Organic growth declined 2.4% vs a 6.2% increase in the prior year. 

Net sales and Organic growth comprised 5.8% value realization and 8.2% volume declines. 

Approximately five points of the volume performance are attributable to an early and strong start to the cold, cough, and flu season last year, 2022 product discontinuations, and customer inventory reductions. 

The remaining approximately three points of volume performance are mainly due to softer than anticipated performance in the U.S. Skin Health and Beauty business and continued softness in China.

Self care segment sales dipped slightly to $1.54 billion from $1.57 billion a year ago. Skin Health and Beauty sales fell to $1 billion from $1.1 billion a year ago. Essential Health sales reached $1.13 billion versus $1.11 billion.

The fourth quarter adjusted gross profit margin was 59.5% compared to 57.3% a year ago.

Fourth quarter Adjusted operating income margin was 21.8% vs 19.9% a year ago.

Guidance: Kenvue expects fiscal year 2024 reported sales growth of 1.0%-3.0%. The company expects full-year 2024 organic growth of 2.0%-4.0%.

Kenvue expects the full-year 2024 adjusted operating income margin to be slightly below 2023 as strong gross margin progression is offset by absorbing a full year of public company costs and 50 basis points of foreign currency headwinds.

The company sees fiscal year adjusted EPS of $1.10 – $1.20 versus the consensus of $1.26.

The consumer health company says its guidance reflects the potential for a continued challenging macro-backdrop and the possibility for unknowns in our seasonal businesses.

Price Action: KVUE shares are down 5.34% at $19.43 on the last check Thursday.

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