Health and Healthcare

Johnson & Johnson's Impressive Quarter, Still Held Back by One Segment

Chris Lange

Published: July 16, 2020 10:57 am

Johnson & Johnson (NYSE: JNJ) released its most recent quarterly results before the markets opened on Thursday. For the second quarter, the pharmaceutical giant said that it had $1.67 in earnings per share (EPS) and $18.34 billion in revenue. That compares with consensus estimates of $1.48 in EPS and revenue $17.5 billion, as well as the $2.58 per share and $20.56 billion posted in the same period of last year.

Consumer Health sales decreased 3.4% on an adjusted operational basis to $3.30 billion. This was driven primarily by the COVID-19 pandemic, most notably reflected in skin health and beauty care products, followed by women’s health care products and international baby care products.

Pharmaceutical sales increased 3.9% to $10.75 billion. This increase was driven by Stelara, Darzalex, Imbruvica, Erleada and Tremfya.

Medical Devices worldwide operational sales, excluding the net impact of acquisitions and divestitures, declined by 32.5%, driven by the estimated net negative impact of the pandemic and the associated deferral of medical procedures to the company’s Surgery, Orthopaedics, Vision and Interventional Solutions businesses.

Looking ahead to the 2020 full year, Johnson & Johnson expects to see EPS in the range of $7.85 to $8.05 and adjusted operational sales between $81.0 billion and $82.5 billion. Consensus estimates are calling for $7.73 in EPS and $79.54 billion in revenue for the year.

Separately, the company has been accelerating its vaccine hopes with a fair amount of success. Look for results from its Phase 1/2a clinical trial of Ad26.COV2-S in the coming month.

Management noted that the company is continuing to navigate the external landscape successfully and that it remains focused on advancing the development of a vaccine to help address this pandemic and save lives.

Johnson & Johnson stock traded down less than 1% on Thursday, at $147.65 in a 52-week range of $109.16 to $157.00. The consensus price target is $164.24.