Billionaire investor Daniel Loeb’s hedge fund, Third Point, is building a stake in Kenvue, the $44 billion consumer healthcare company known for brands like Band-Aids and Tylenol. News of Third Point’s involvement gave Kenvue’s stock a brief boost, with shares climbing over 2% on Friday before closing at $23.01. Kenvue, headquartered in Summit, New Jersey, was spun off from Johnson & Johnson two years ago and has been under growing pressure from activist investors seeking strategic changes to enhance its performance.
Earlier this year, Kenvue averted a proxy battle with activist hedge fund Starboard Value by appointing its founder and CEO, Jeffrey Smith, to the board. Starboard has been urging Kenvue to rethink the positioning and pricing of its brands to drive better financial results. Since then, Kenvue has faced additional pressure from Toms Capital Investment Management, another activist firm that has taken a stake and is pushing the company to explore strategic alternatives, including the potential sale of parts of its business or even the entire company.
It remains unclear how significant Third Point’s stake in Kenvue is or whether the hedge fund has begun discussions with the company’s board or management. Third Point, which manages about $12 billion in assets, is known for its occasional activist campaigns targeting companies such as Advance Auto Parts, Walt Disney, and Bath & Body Works. A representative for Third Point declined to comment on the matter, while Kenvue emphasized that it regularly engages with investors but refrains from commenting on individual discussions. In a statement, Kenvue stressed that its board acts in the best interests of all shareholders and remains focused on accelerating sustainable and profitable growth while enhancing shareholder value.
Despite the popularity of its brands like Aveeno, Listerine, and Zyrtec, Kenvue reported flat net sales of $15.5 billion in 2024. Since its listing in May 2022, the company’s stock has gained 8% this year but is still down 13.2% from its original public offering price. Third Point’s entry into Kenvue comes after the hedge fund achieved a strong 25% return in 2024, a significant recovery from previous years, including a modest 4% gain in 2023 and a 22% loss in 2022. The firm’s strategic shift toward consumer discretionary, financial, and industrial sectors last year helped fuel its performance following a broader post-election market rally.
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