Starboard Value: Activist investment firm Starboard Value LP has set its sights on Kenvue Inc. (NYSE: KVUE) and Pfizer Inc. (NYSE: PFE), with a mission to improve their financial performance and unlock shareholder value. During the 2024 Active-Passive Investor Summit, Starboard CEO Jeffrey Smith laid out strategies aimed at revitalizing both companies, with a particular focus on increasing operational efficiency and optimizing growth potential.
Starboard has reportedly taken a “sizable” stake in Kenvue, the consumer health spinoff from Johnson & Johnson, and is pushing for changes to boost its underperforming stock. Smith emphasized the importance of focusing on Kenvue’s skin health and beauty segment, which includes well-known brands like Neutrogena and Aveeno. According to Starboard, this segment’s lagging growth has been a drag on the company’s overall performance.
“Kenvue has a strong portfolio of leading consumer brands, but its potential has not been fully realized. There’s a clear opportunity to improve revenue growth and margins in key segments like skin health,” Smith stated during his presentation. He suggested strategic initiatives that could enhance Kenvue’s market position and deliver better returns for shareholders.
Starboard is also eyeing Pfizer, where it has a $1 billion stake. The firm criticized Pfizer for its lack of internal innovation and underwhelming return on R&D investments, citing the company’s poor handling of its post-COVID forecast. Starboard’s proposals call for a more disciplined approach to capital allocation and holding management accountable to drive future innovation.
The activist investor’s moves reflect its ongoing strategy of identifying undervalued companies and pushing for targeted interventions to increase profitability. As Starboard engages with Kenvue and Pfizer, market analysts and investors are watching closely to see how these efforts could reshape the companies’ futures.
With Starboard’s track record in activist investing, its involvement in both Kenvue and Pfizer could spark significant changes in strategy, potentially unlocking billions in shareholder value.
