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Consumer health company Kenvue Inc. reported third-quarter sales of $3.89 billion, down 0.4% year-over-year (up 0.9% organically), slightly below the consensus of $3.93 billion.

Kenvue’s some of the iconic brands include Aveeno, BAND-AID Brand, Johnson’s, Listerine, Neutrogena, and Tylenol.

Also Read: Tylenol, Listerine Maker Kenvue Under Activist Spotlight With Starboard Value Stake — Overhaul Ahead For The Johnson & Johnson Spinoff?

Value realization was driven by a combination of carry-over pricing and price actions taken this year. The volume decline was driven primarily by Skin Health and Beauty and Self Care, partially offset by growth in Essential Health.

Adjusted gross profit margin expanded 130 basis points to 60.7% from 59.4% in the prior year, reflecting productivity gains attributable to global supply chain efficiency initiatives and benefits from value realization.

Third quarter adjusted operating income margin was 22.1% vs 23.3% in the prior year.

The self-care segment recorded $1.63 billion in net sales, up 0.7% year over year. The skin health and beauty segment recorded a 4.2% drop in second-quarter net sales to $1.07 billion. Essential Health segment sales increased around 1.6% to $1.20 billion.

“During the third quarter, we continued to drive strong productivity and realize efficiency benefits from Our Vue Forward, which we are reinvesting behind our iconic brands to unleash the full potential of our business and fulfill our commitment to create long-term shareholder value,” said Thibaut Mongon, Chief Executive Officer. “This reinvestment is enabling us to continue to drive share gains in Self Care, deliver broad-based growth across the Essential Health categories, and build the right foundation in Skin Health and Beauty, where we are seeing early signs of recovery.

Guidance: Kenvue expects 2024 net sales growth and organic growth toward the low end of its outlook of 1.0%-3.0% and 2.0%-4.0%, respectively.

The consumer health giant reaffirms 2024 adjusted EPS of $1.10-$1.20 versus consensus of $1.14

Price Action: KVUE stock is up 3.44% at $23.28 at the last check on Thursday.

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For the quarter ended September 2024, Kenvue (KVUE) reported revenue of $3.9 billion, down 0.4% over the same period last year. EPS came in at $0.28, compared to $0.31 in the year-ago quarter.

The reported revenue compares to the Zacks Consensus Estimate of $3.92 billion, representing a surprise of -0.56%. The company delivered an EPS surprise of +3.70%, with the consensus EPS estimate being $0.27.

While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.

Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.

Here is how Kenvue performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

• Net Sales- Self Care: $1.63 billion compared to the $1.61 billion average estimate based on three analysts. The reported number represents a change of +0.7% year over year.
• Net Sales- Essential Health: $1.20 billion versus the three-analyst average estimate of $1.24 billion. The reported number represents a year-over-year change of +1.6%.
• Net Sales- Skin Health and Beauty: $1.07 billion compared to the $1.09 billion average estimate based on three analysts. The reported number represents a change of -4.2% year over year.
• Adjusted Operating Income- Self Care: $557 million versus the two-analyst average estimate of $566.11 million.
• Adjusted Operating Income- Essential Health: $291 million versus the two-analyst average estimate of $150.95 million.
• Adjusted Operating Income- Skin Health and Beauty: $191 million versus the two-analyst average estimate of $184.07 million.

View all Key Company Metrics for Kenvue here>>>

Shares of Kenvue have returned +4.5% over the past month versus the Zacks S&P 500 composite's +3.2% change. The stock currently has a Zacks Rank #4 (Sell), indicating that it could underperform the broader market in the near term.

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