Will Johnson & Johnson (JNJ) Beat this Earnings Season? - Analyst Blog


Johnson & Johnson ( JNJ ) is scheduled to report second quarter 2014 results before the opening bell on Jul 15.

Why a Likely Positive Surprise?

Our proven model shows that Johnson & Johnson is likely to beat earnings because it has the right combination of two key ingredients.

Positive Zacks ESP: Johnson & Johnson has an Earnings ESP of +1.30%. This is a meaningful and leading indicator of a likely positive earnings surprise for the shares.

Zacks Rank : Johnson & Johnson carries a Zacks Rank #2 (Buy) which when combined with a +1.30% ESP makes us confident of an earnings beat.

Note that stocks with Zacks Rank #1, 2 and 3 have a significantly higher chance of beating earnings. The Sell-rated stocks (#4 and 5) should never be considered going into an earnings announcement.

What is Driving the Better-than-Expected Earnings?

Even though we expect Johnson & Johnson to continue facing currency headwinds and other headwinds in the form of pricing pressure, manufacturing issues and U.S. healthcare reform, we believe that the strong performance of the pharmaceuticals segment especially products like Remicade, Olysio, Xarelto, Invokana and Zytiga will aid solid results for the company in the second quarter.

Last quarter, Johnson & Johnson had posted a positive earnings surprise of 4.05%. Johnson & Johnson had posted an earnings surprise in the trailing four-quarters with an average surprise of 4.23%.

Other Stocks to Consider

Here are some other companies you may want to consider as our model shows these also have the right combination of elements to post an earnings beat this quarter:  

Biogen Idec Inc. ( BIIB ) has an earnings ESP of +2.19% and carries a Zacks Rank #1. It is scheduled to report its second-quarter results on Jul 23.

BioMarin Pharmaceutical Inc. ( BMRN ) has an earnings ESP of +2.38% and carries a Zacks Rank #2. It is expected to report its second-quarter results on Jul 30.

The earnings ESP for Celgene Corporation ( CELG ) is +2.60% and it carries a Zacks Rank #2. The company is scheduled to release its second-quarter results on Jul 24.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Earnings , Stocks

Referenced Stocks: BMRN , CELG , JNJ , BIIB



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