Reckitt Benckiser

Reckitt Benckiser is a UK-based consumer health and hygiene company. It calls its core business "Core Reckitt," built around 11 "Powerbrands" that make up more than 80% of Core Reckitt net revenue: Dettol and Lysol in disinfectant cleaning, Finish and Vanish in dishwashing and stain removal, Harpic in toilet cleaning, Nurofen, Mucinex, Gaviscon, and Strepsils in over-the-counter health, and Durex and Veet in intimate wellness. Separately, it owns Mead Johnson Nutrition, maker of the Enfamil infant formula brand, which it bought in 2017 for $16.6 billion in equity, or about $17.9 billion with debt. In July 2024, Reckitt said that Mead Johnson is not a core business and that it will consider all options for it.

In December 2025, Reckitt completed the sale of its Essential Home business, including Air Wick and Calgon, to private equity firm Advent International for up to $4.8 billion, including up to about $1.3 billion of later payments, keeping a 30% stake in the buyer's holding vehicle. Emerging markets are now Reckitt's main growth engine, while Europe and North America grow more slowly or shrink. Reckitt's ordinary shares trade on the London Stock Exchange; five RBGLY ADRs represent one ordinary share.

Reckitt Benckiser trades at a discount because investors worry about two issues. The first issue is Mead Johnson. In July 2024, Reckitt said that the infant-formula unit is not core, but it has not announced a sale. Lawsuits over necrotizing enterocolitis (NEC), a serious bowel disease in premature babies, make a sale more difficult.

The second issue is lower reported earnings. Adjusted earnings per share fell 9.7% in H1 2026 because the profit of Essential Home, which Reckitt sold, is gone. For the gap to close, Core Reckitt like-for-like growth must stay at or above the 4.2% of Q2 2026, in line with the 4% to 5% guidance for 2026. Like-for-like growth removes the effect of currency and of businesses bought or sold.

A sale of Mead Johnson, even at a much lower price than in 2017, would remove a large distraction and let the market value the simpler business alone. Mead Johnson has no adverse NEC jury verdict outstanding. It won the first federal bellwether trial in August 2026, and an appeals court reversed a $60 million verdict in June 2026. But hundreds of NEC lawsuits are still pending, and the reversed case can go to a new trial.

The next tests are the Q3 trading update on October 27, 2026 and an investor event on North America on November 19, 2026. News on Mead Johnson can come at any time. If growth holds and Mead Johnson is sold, the gap can close within about a year. The main risk is a large NEC verdict or settlement, or no sale, which would keep capital and management attention tied up after 2026.

1. Oct 27, 2026Pending

   Q3 2026 trading update: Core Reckitt growthCore Reckitt like-for-like growth at or above the 4.2% of Q2, in line with 4% to 5% for the year, passes; growth back below 3% or a guidance cut fails.
2. Nov 19, 2026Pending

   Investor event: Reckitt Focus On North AmericaA clear plan for North America growth that supports 4% to 5% Core Reckitt growth passes; a weaker North America outlook fails.
3. Mar 2027 · est.Pending

   Full-year 2026 results: leverage and Mead JohnsonNet debt falling below 2.5 times adjusted EBITDA and progress on a Mead Johnson sale pass; higher leverage or no sale path fails.

Every passed and failed checkpoint across all picks

Reckitt borrows centrally through unsecured bonds, commercial paper and bank lines. It aims to keep the debt level of an A-rated company. Read more

• Mead Johnson still faces hundreds of pending necrotizing enterocolitis (NEC) lawsuits over Enfamil in US federal and state courts. Reckitt won the first federal bellwether trial in August 2026, but an earlier $60 million verdict against it was only reversed on appeal and sent back for retrial, not dismissed. No date is set for the next trial against Mead Johnson. In August 2026, Abbott agreed to pay about $670 million to settle about 2,000 NEC claims, which gives a reference for a possible Mead Johnson settlement. A large adverse verdict or settlement would also make Mead Johnson harder to sell.
• Reckitt said in July 2024 that Mead Johnson Nutrition is not core, but it has announced no sale. A sale would probably be at a price far below the $16.6 billion equity price of 2017. The last reported possible buyer was Danone, in April 2026, and no talks were confirmed. A stalled or failed sale process would keep tying up capital and management attention.
• Adjusted earnings per share fell 9.7% in H1 2026 because Essential Home's profit contribution is gone. Further portfolio simplification, including a Mead Johnson sale, would likely cause a similar near-term earnings drag even if it is good for the business long term.
• Europe, one of Reckitt's larger markets, keeps shrinking: like-for-like revenue there fell 4.2% in Q1 2026 and 3.0% in H1 2026. Growth guidance depends on emerging markets and North America offsetting continued European weakness.
• Reckitt reports in British pounds while RBGLY trades in US dollars. Swings in the pound-dollar exchange rate can move the ADR's returns up or down independent of how the underlying business performs.
• RBGLY is a US over-the-counter ADR, not a NYSE or Nasdaq listing. It likely trades with less liquidity and wider bid-ask spreads than Reckitt's London-listed ordinary shares.
• Private-label and store-brand products compete with Reckitt's household cleaning and OTC health brands, especially among price-sensitive shoppers, which can pressure volumes and limit pricing power in some categories.

• September 16, 2026Reckitt announced up to $600 million of multi-year investment in its US operations, including a new science and innovation campus in New Jersey and an expanded OTC manufacturing facility in North Carolina opening in H1 2027.
• September 1, 2026J.P. Morgan upgraded Reckitt to overweight from neutral after the Mead Johnson trial win and raised its price target to 6,500p from 5,800p. Reckitt shares rose about 4% that day.
• August 31, 2026A federal jury in Chicago returned a unanimous defense verdict for Mead Johnson in Inman v. Mead Johnson, the first bellwether trial in the federal NEC baby-formula litigation (MDL 3026) to reach a jury verdict. The London market was closed that day, and Reckitt shares rose on September 1.