J&J (JNJ) Tops Q1 Earnings; Pharma Segment Drives Sales

Johnson & Johnson JNJ, the bellwether of healthcare companies, has a strong presence in the pharmaceutical, medical devices and consumer care markets across the world. This New Jersey-based company is well known for its baby-care products and brands like Tylenol in addition to drugs like Remicade and Imbruvica.

However, like many of its peers, JNJ is facing generic competition and pricing pressure for some of the products in its pharmaceutical segment.

In this scenario, investor focus remains on late-stage pipeline candidates and their commercial potential as well as the performance of new products apart from the usual top-and bottom-line numbers.

J&J’s performance has been pretty impressive, with the company exceeding earnings expectations in all the trailing four quarters. The average positive earnings surprise over the last four quarters is 1.61% Estimates for 2020 have gone down slightly in the past seven days.

Currently, JNJ has a Zacks Rank #2 (Buy), but that could definitely change following the company’s earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:

Earnings Beat: JNJ beat on first quarter earnings - the company reported EPS of $2.10 while our consensus called for EPS of $2.03.

Revenues Beat: Revenues also beat expectations. Johnson & Johnson posted revenues of $20.02 billion, compared to our consensus estimate of $19.63 billion.

Key Statistics: Pharmaceutical segment sales rose 4.1% year over year to $10.24 billion, reflecting 7.9% operational growth. The strong performance was led by the company’s oncology drug Darzalex as well as psoriasis treatment, Stelara.

Issues 2019 Outlook: J&J raised its adjusted sales and earnings growth forecast for the year on continued strength of its business,

J&J tightened its 2019 adjusted earnings per share guidance from a range of $8.50 - $8.65 to $8.53 - $8.63. The guidance range, however, reflects a growth rate of 4.3%- 5.5%, higher than 3.9% - 5.8% previously. The Zacks Consensus Estimate for EPS for 2019 was $8.58.

Revenues are still expected in the range of $80.4 to $81.2 billion, including currency impact. The Zacks Consensus Estimate for revenues of $81.18 billion.

Adjusted operational sales growth, (excluding currency impact, acquisitions/divestitures) is expected to be in the range of 2.5% to 3.5%, higher than 2% to 3% expected previously.

Stock Price Impact: Shares rose 1.9% in pre-market trading.


Johnson & Johnson Price and Consensus


Johnson & Johnson Price and Consensus | Johnson & Johnson Quote


Check back later for our full write up on this JNJ earnings report later!

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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 Nasdaq, Inc.

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