L’Oreal (OTCMKTS:LRLCY) and Kenvue (NYSE:KVUE) Critical Analysis

L’Oreal (OTCMKTS:LRLCY) and Kenvue (NYSE:KVUE) are both large-cap consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, risk, institutional ownership, profitability and valuation.

Dividends

L’Oreal pays an annual dividend of $1.13 per share and has a dividend yield of 1.2%. Kenvue pays an annual dividend of $0.83 per share and has a dividend yield of 3.9%. Kenvue pays out 112.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Kenvue has increased its dividend for 1 consecutive years. Kenvue is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

0.4% of L’Oreal shares are held by institutional investors. Comparatively, 97.6% of Kenvue shares are held by institutional investors. 0.2% of Kenvue shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk and Volatility

L’Oreal has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500. Comparatively, Kenvue has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for L’Oreal and Kenvue, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
L’Oreal	2	4	1	1	2.13
Kenvue	1	7	5	0	2.31

Kenvue has a consensus target price of $24.3750, indicating a potential upside of 15.03%. Given Kenvue’s stronger consensus rating and higher possible upside, analysts plainly believe Kenvue is more favorable than L’Oreal.

Profitability

This table compares L’Oreal and Kenvue’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
L’Oreal	N/A	N/A	N/A
Kenvue	9.37%	20.06%	7.78%

Valuation and Earnings

This table compares L’Oreal and Kenvue”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
L’Oreal	$47.06 billion	5.21	$6.93 billion	N/A	N/A
Kenvue	$15.46 billion	2.63	$1.03 billion	$0.74	28.64

L’Oreal has higher revenue and earnings than Kenvue.

Summary

Kenvue beats L’Oreal on 10 of the 16 factors compared between the two stocks.

About L’Oreal

L'Oréal S.A., through its subsidiaries, manufactures and sells cosmetic products for women and men worldwide. The company operates through four divisions: Consumer Products, L'oréal Luxe, Professional Products, and Dermatological Beauty. It offers skincare, make-up, hair colourants, haircare, perfumes, and hygiene products. The company provides its products under the L'Oréal Paris, Garnier, Maybelline New York, NYX Professional Makeup, Stylenanda, Essie, Dark & Lovely, Mixa, Magic Mask, Niley, Lancôme, Yves Saint Laurent, Armani, Kiehl's Since 1851, Helena Rubinstein, Biotherm, Shu Uemura, IT Cosmetics, Ralph Lauren Fragrance, Urban Decay, Mugler, Valentino, Viktor&Rolf, Azzaro, Prada, Cacharel, Maison Margela Fragrance, Diesel, Yue Sai, Atelier Colonge, Carita, Takami, Aesop, L'Oréal Professionnel Paris, Kérastase, Redken, Matrix, Pureology, Pulp Riot, La Roche-Posay, Vichy, CeraVe, SkinCeuticals, and Skinbetter Science brands. It sells its products through distribution channels, such as hair salons, local stores, e-commerce, travel retail, mass market retail, department store perfumeries, pharmacies, drug stores, medi-spas, and free-standing stores. L'Oréal S.A. was founded in 1909 and is headquartered in Clichy, France.

About Kenvue

Kenvue Inc. operates as a consumer health company worldwide. The company operates through three segments: Self Care, Skin Health and Beauty, and Essential Health. The Self Care segment offers cough, cold and allergy, pain care, digestive health, smoking cessation, eye care, and other products under the Tylenol, Motrin, Benadryl, Nicorette, Zarbee's, ORSLTM, Rhinocort, Calpol, and Zyrtec brands. The Skin Health and Beauty segment provides face and body care, hair, sun, and other care products under the Neutrogena, Aveeno, Dr.Ci:Labo, Le Petit Marseillais, Lubriderm, Rogaine, and OGX brand names. The Essential Health segment offers oral and baby, women's health, wound, and other care products under the Listerine, Johnson's, Band-Aid, and Stayfree, o.b., tampons, Carefree, and Desitin Diaper Rash brands. The company was incorporated in 2022 and is headquartered in Skillman, New Jersey.