Should investors trust KVUE's earnings guidance for 2025?

**Investors should approach KVUE's 2025 earnings guidance with caution**. Here's why:

1. **Guidance Details**: KVUE's earnings guidance for 2025 includes an EPS range of $1.440 to $1.469, which is slightly above the consensus estimate of $1.250. The revenue guidance is set at $15.3 billion to $15.6 billion, compared to the consensus estimate of $15.9 billion. This suggests that while the company is optimistic about its performance, the guidance is not overly ambitious.

2. **Market Analysts' Perspectives**: Redburn Atlantic, a research firm, has recently initiated coverage on KVUE with a Neutral rating and a price target of $23.50. This neutral stance indicates that while the stock has potential, it also carries risks. The firm's analysis highlights challenges such as underperformance of certain brands and execution issues, which could impact KVUE's ability to meet its guidance.
3. **Recent Performance and Challenges**: KVUE has faced a soft performance recently, with fourth-quarter sales showing a small drop and 2025 revenue projections missing market expectations. The company is also dealing with headwinds from foreign currency translation and a mild cold and cough season, which have affected sales in certain segments.
4. **Organic Growth Expectations**: KVUE expects organic sales growth of 3% to 4% and a 1% increase in EPS for 2025. While these are positive indicators, they are slightly below the market's expectations and reflect the impact of external factors such as the strong dollar and weak demand for cough and cold products.
5. **Strategic Initiatives**: In response to performance challenges, KVUE has increased marketing and advertising investments, including efforts to engage with Gen Z consumers. These strategic moves could positively influence future performance, but their effectiveness is yet to be seen.

In conclusion, while KVUE's 2025 earnings guidance shows potential, the cautious approach of market analysts, recent performance challenges, and external factors impacting sales suggest that investors should exercise caution and consider these factors when evaluating the company's guidance.