Kenvue reports Q1 2026 results on May 14 with short sellers actively unwinding positions — a notable reversal in sentiment heading into the print.
The clearest signal going into earnings is the pullback in short positioning. Short interest has dropped 10% over the past month to 2.9% of the free float — still modest in absolute terms, but the direction is consistent and accelerating. In the past week alone, SI fell more than 5%. That retreat is not driven by a short squeeze: the borrow market is extremely loose. The cost to borrow has collapsed to just 0.06%, down sharply from levels around 0.3–0.4% that held through April. Availability is effectively unconstrained, meaning there is no structural pressure forcing shorts to cover — they are choosing to exit. Options positioning confirms the benign read. The put/call ratio is running at 0.41, almost perfectly in line with its 20-day average, with a z-score near zero. Neither options traders nor short sellers are braced for a bad number.
The analyst community is less convinced that the setup justifies optimism. Multiple firms trimmed price targets in April — Citigroup, Barclays, and UBS all lowered to the $18–$19 range while holding neutral or equal-weight ratings. That keeps the consensus mean target at roughly $19.50, about 11% above the current price of $17.59, but the direction of estimate revisions has been downward. EPS momentum over 30 days ranks in just the 39th percentile, though the 90-day reading is stronger at the 72nd percentile — suggesting near-term estimate cuts have stabilised after more pronounced downward pressure earlier in the year. Against that backdrop, valuation offers a partial offset: Kenvue trades at roughly 14.6x earnings and 10.9x EV/EBITDA, both compressed over the past month, while a forward dividend yield close to 4.9% ranks in the 88th percentile on dividend score — a floor that income-oriented holders are unlikely to abandon lightly.
Institutional ownership lends some structural stability to the name. Vanguard and BlackRock together hold more than 20% of shares. FMR added a substantial 41 million shares in its most recent reported period. Starboard Value — a known activist — holds a roughly 1.4% stake with no recent change, a position worth watching given Kenvue's ongoing strategic repositioning since its spin-off from Johnson & Johnson. Insider activity has been limited and routine: small award-linked sells from the COO and HR Director in March, with no net buying of note.
The February print provided little drama, with the stock up less than 1% on the day and 1.7% over the following five days. May 14 will test whether the combination of modest valuation, a durable dividend, and retreating short interest is enough to attract buyers — or whether the string of downward analyst revisions reflects concerns about volume trends and margin delivery that the market has yet to fully price in.
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