(Bloomberg) — Kenvue Inc., the consumer health company that Johnson & Johnson spun off this month, will be eligible for ratings from a number of major Wall Street banks next week, offering a chance to see how analysts are assessing IPOs amid the recent Equity volatility and recession concerns.
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Shares of the company are up about 20% since May 3, when the company raised $3.8 billion in its biggest U.S. IPO since 2021. The IPO came during the weakest period for stock listings since 2016, according to data compiled by Bloomberg News. The so-called rest phase for ratings by analysts of the companies involved in the IPO ends on May 30th.
The list of underwriters includes Goldman Sachs Group Inc., JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc., Deutsche Bank Securities, BNP Paribas, HSBC, RBC Capital Markets, UBS and Siebert Williams Shank.
Kenvue makes a number of popular products including Tylenol, Listerine, Neutrogena and Nicorette. Like J&J, the company has been sued for talc violations and warned that there could be more lawsuits outside of the US and Canada. Still, the company reported pro forma net income of about $1.5 billion on sales of nearly $15 billion for the fiscal year ended Jan. 1, company filings show.
In a May 4 research note on the IPO, New Constructs CEO David Trainer rated the company neutral and said it lacked the margins of many of its peers. Trainer, who was unaffected by the ratings dormancy, added that profitability doesn’t always mean a good stock. He said Kenvue’s valuation at more than $41 billion at its IPO may be on the high end, leaving little upside for investors.
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The company may also need to increase its capital and marketing spending to grow, Diana Gomes, an analyst at Bloomberg Intelligence, said in a May 18 note.
Read more: Kenvue could sacrifice its margin by 2024 to reignite growth
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