Kimberly-Clark: Pass the Kleenex & Tylenol: further thoughts on the KVUE acquisition

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Kimberly-Clark: Pass the Kleenex & Tylenol: further thoughts on the KVUE acquisition

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Kimberly-Clark

Pass the Kleenex & Tylenol: further

thoughts on the KVUE acquisition

Reiterate Rating: BUY | PO: 120.00 USD | Price: 97.04 USD

KVUE deal is a long-term opportunistic acquisition 14 May 2026

Following our initial thoughts on the announced KVUE acquisition (see report), we detail Equity

pro forma estimates for the transaction and market share analysis. Since the acquisition

announcement on 11/03/25, KMB shares are -19% vs. XLP +10.5%. Although integration Anna Lizzul

and execution will take time, we see KMB as a logical buyer to KVUE’s assets due to Research Analyst

BofAS

complementary categories and potential for improving reach. We see the deal as +1 646 855 2569

opportunistic given the acquisition multiple at announcement of 14x KVUE’s LTM adj. anna.lizzul@bofa.com

EBITDA and purchase price of $21.01 per share is similar to the market value of KVUE Peter T. Galbo, CFA

Research Analyst

prior to the negative impact from Tylenol headlines in September 2025. We reiterate our BofAS

KMB Buy rating and $120 PO. See page 3 for more details. +1peter.galbo@bofa.com646 743 0175

Value creation potential, particularly if multiples improve

Pro forma revenues for the combined entity are expected at ~$32bn and $7bn in EBITDA

Stock Datapost-close. While the market maintains skepticism on cost synergies expected at $1.9bn

within three years post-close and revenue synergies of $500m within four years, we see Price 97.04 USD

a path to value creation, particularly if Staples multiples improve following a challenging Price Objective 120.00 USD

YTD 2026. See pages 4-5 for our pro forma estimates and multiple analysis. Date Established 10-Apr-2026