Citigroup analysts initiated a 90-day positive catalyst watch on Kenvue (NYSE:KVUE), suggesting the stock might outperform in the near term.
The analysts’ action comes in anticipation of a forthcoming judge’s decision on the Tylenol case’s Daubert hearings, expected by early 2024. Citi analysts, having attended the recent Daubert hearing, now believe there’s an increased likelihood of the case being resolved favorably. While the outcome remains uncertain, they see greater upside potential, envisioning a share price range of $23-24, as opposed to a downside risk in the $18-19 range.
Despite this short-term optimism, Citigroup maintains a Neutral rating on KVUE shares. The analysts cite several challenging fundamentals affecting Kenvue, including a slowdown in Self Care, weaker performance in China, and a slower-than-expected recovery in the Skin Health & Beauty sector.