Kenvue Inc (NYSE: KVUE) opened about 20% higher this morning after Kimberly-Clark (NYSE: KMB) announced a $40 billion acquisition of the consumer health company.
According to its press release, it will pay $3.50 per share for Kenvue in cash and the remainder in KMB stock – valuing the Summit-headquartered firm at a 50% premium versus its previous close.
Kimberly-Clark shares, however, are down nearly 13% at writing, reflecting investor caution over integration risks and dilution.
Still, a senior financial journalist and market news analyst at CNBC, David Faber, believes the KVUE deal could as much as double KMB’s multiple over the long term.
Kenvue could help KMB stock attract a PNG-like multiple
According to David Faber, the strategic buyout will transform Kimberly-Clark into a much bigger company similar to Procter & Gamble that’s currently trading at about 21 times earnings.
In comparison, KMB shares’ synergy-adjusted multiple sits at about 10 only. But the hope is that post-integration, the company can “reach a P&G multiple.”
Kimblery-Clark believes the KVUE deal will unlock up to $2.1 billion worth of synergies – mostly from cost savings and revenue uplift as the integration reshapes the company’s brand portfolio and financial profile.
More importantly, while KMB is paying a massive premium for Kenvue, it still is “well below the median multiple for deals in the consumer product space,” Faber confirmed.
In short, if successful, the KVUE transaction could truly prove dramatic for Kimberly-Clark stock, and that warrants buying it at current levels, argued famed investor Jim Cramer in a segment of CNBC today.
Why Jim Cramer ‘feels good’ about Kimberly-Clark’s Kenvue deal
Jim Cramer voiced strong support for the Kenvue transaction since “where KMB is strong, they’re not (China) – and where they’re strong (Europe), Kimberly is not.”
For the Irving-headquartered consumer goods company, disclosed terms of the KVUE agreement are akin to “an opportunity to become a much bigger company at a much lower price,” he noted.
Cramer recommends owning Kimberly-Clark stock here primarily because the company is buying a portfolio of household staples that “everybody has at home.”
Confidence in Mike Hsu’s leadership and balance sheet discipline were among other reasons cited for the bullish view on KMB shares.
According to him, the litigation risk surrounding Kenvue’s Tylenol is grossly overstated and buying Kenvue could make Kimberly-Clark a “great growth company again.”
How to play Kimberly-Clark shares heading into 2026
While the market’s initial reaction was cautious, long-term investors may see value in Kimberly-Clark’s strategic pivot.
The deal gives Kimberly-Clark access to Kenvue’s global footprint, especially in markets where it’s currently underrepresented.
It also consolidates a wide range of consumer healthcare brands under one roof, potentially boosting pricing power and distribution efficiency.
If Kimberly-Clark can deliver on promised synergies and reshape its earnings profile, KMB stock could re-rate meaningfully.
Meanwhile, a 46% stake in the new entity means a fresh path forward for Kenvue shareholders after months of activist pressure.
Note that Wall Street analysts currently have an “overweight” rating on KVUE stock, but Kimberly-Clark shares they rate at “hold” only heading into 2026.
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