Health care giant Johnson & Johnson (NYSE:JNJ) has had a good year with its shares trading near all-time highs. The company looks to keep a trend of beating analyst estimates when third-quarter financial results are reported before market open Tuesday.
Here are the earnings estimates, what experts are saying ahead of the report and key items to watch.
Earnings Estimates: Analysts expect Johnson & Johnson to report third-quarter revenue of $23.74 billion, up from $22.47 billion in last year’s third quarter, according to data from Benzinga Pro.
The company has beaten analyst estimates for revenue in five straight quarters and in nine of the last 10 quarters overall.
Analysts expect Johnson & Johnson to report third-quarter earnings per share of $2.75, up from $2.42 in last year’s third quarter.
The company has beaten analyst estimates for earnings per share in more than 10 straight quarters.
Read Also: Retail Investors’ Top Stocks With Earnings This Week: Fastenal, ASML, TSMC And More
What Experts are Saying: A strong second-quarter and raised guidance may have kick-started a rally in Johnson & Johnson shares in recent months.
“Johnson & Johnson is quietly having a banner year,” Freedom Capital Markets Chief Market Strategist Jay Woods said in a weekly newsletter. “In June, shares broke out of a nearly five-year neutral range and are up 30% year-to-date.”
The market expert said the quarterly results and guidance helped boost shares, along with favorable guidance on any potential impact from tariffs.
Another reason for Johnson & Johnson shares trading higher, according to Woods, is the company separating off its consumer health business as Kenvue Inc (NYSE:KVUE).
“Now they have been able to focus on pharma innovation and medical devices, which tend to command higher growth and margins and have avoided the cloud that the Tylenol controversy has caused KVUE.”
Woods said analyst expectations on Johnson & Johnson stock could be raised after Tuesday’s report.
“Over the long term, this is a stock that should continue to trend higher. It has turned things around fundamentally and now technically.”
Here are recent analyst ratings on Johnson & Johnson and their price targets:
- Morgan Stanley: Maintained Equal-Weight rating, raised price target from $176 to $178
- Goldman Sachs: Maintained Buy rating, raised price target from $186 to $212
- Citigroup: Maintained Buy rating, raised price target from $200 to $213
- Bernstein: Maintained Market Perform rating, raised price target from $172 to $193
- Bank of America: Maintained Neutral rating, raised price target from $175 to $198
- Wells Fargo: Upgraded from Equal-Weight to Overweight, raised price target from $170 to $212
Key Items to Watch: Johnson & Johnson’s second-quarter results saw several drugs highlighted for their strong growth, helping to offset negative impacts from Stelara in immunology and COVID-19 in infectious diseases.
Stelara sales were down 42.7% year-over-year and will be one of the many items to watch.
Overall, cancer drug sales were up 24% year-over-year to $6.31 billion in the second quarter, helping offset a 15.4% year-over-year decline for Immunology sales for the quarter.
The company’s MedTech unit saw sales up 7.3% to $8.54 billion in the second quarter and will be an area to watch with the company’s renewed focus on innovative medicine and medtech after spinning off its consumer business.
Guidance will be one of the most watched items in the report with the company previously raising guidance for both full-year revenue and full-year earnings per share after the second quarter results.
Analysts and investors may be expecting the company to beat and raise once again. Failure to raise guidance again could put pressure on shares and the recent rally.
Another area to watch will be M&A activity for the company and what management has to say about potential deals and cash usage.
The company is in reported discussions to acquire Protagonist Therapeutics (NASDAQ:PTGX), a company with which has an existing collaboration.
Acquiring the company outright could provide a boost to its immunology business segment, which is facing pressure as Stelara faces increased competition.
JNJ Price Action: Johnson & Johnson stock is down 0.18% to $190.38 on Monday versus a 52-week trading range of $140.68 to $192.10. Shares are up 32.1% year-to-date in 2025.
Read Next:
Photo: Shutterstock
