Schaeffers Investment Research·2025-11-03 16:17Core Insights - Kenvue Inc (KVUE), the maker of Tylenol and a former Johnson & Johnson spinoff, saw its stock rise by 16.7% to $16.74 following Kimberly-Clark Corp's (KMB) agreement to acquire the company for $48.70 billion in cash and stock, with the deal expected to close in the second half of 2026 [1] - Despite the positive news for KVUE, KMB's stock fell by 12.6% to $104.61, marking a significant decline and trading at nearly seven-year lows, with a year-to-date drop of 20% [2][1] Kenvue Inc (KVUE) - KVUE's stock was trading at record lows of $14.02 on October 30, and even with today's increase, it remains down 22.8% year-to-date, indicating a challenging market environment prior to the acquisition news [1] - The stock's performance today is poised to be its best since August 2024, reflecting a potential turnaround following a prolonged period of decline [1] Kimberly-Clark Corp (KMB) - KMB's stock is experiencing a significant downturn, trading at almost seven-year lows and on track for its worst day since October 1987, following the announcement of the acquisition [2] - The company has seen a consistent decline, with its stock price dropping from around $120 to current levels, reflecting a channel of lower lows since a peak of $150.45 on March 10 [2] Options Activity - Options trading for both KVUE and KMB has surged, with KVUE seeing 87,000 calls and 24,000 puts, which is triple the average intraday volume, indicating heightened investor interest [2] - KMB options are trading at 40 times the average intraday pace, with the January 2026, 115-strike call attracting significant attention as new positions are being opened [3] - Both companies are outperforming options traders' volatility expectations, as indicated by their Schaeffer's Volatility Scorecard (SVS) readings of 98 for KVUE and 87 for KMB [3]