Analysts from FactSet are predicting that Johnson & Johnson (J&J) will report per-share earnings of $2.52 for the third quarter. This is slightly lower than the $2.55 earnings from the same period last year. However, Estimize, which gathers projections from various sources, is expecting slightly higher earnings of $2.58 per share.
The FactSet consensus estimates that J&J will announce $21.036 billion in revenue for the quarter, compared to $23.791 billion from the previous year. Estimize is also projecting a decrease in revenue but expects it to be around $21.583 billion.
J&J's stock has experienced an 11% decline year-to-date. In contrast, the Dow Jones Industrial Average has gained 2.6%, and the S&P 500 has gained 14%.
Among the 18 analysts surveyed by FactSet about J&J shares, 10 recommend buying the stock, seven recommend holding, and one suggests selling.
What to Watch For
According to JPMorgan analysts, J&J's financial results are not expected to contain many surprises, especially now that the Kenvue spinoff has been completed. Kenvue encompasses J&J's consumer health business, which includes well-known brands like Tylenol, Listerine, Band-Aid, Neutrogena, and Nicorette.
The analysts express confidence in the company's solid fundamentals and a stronger pipeline of products in recent years. Additionally, they note that J&J's MedTech portfolio is experiencing robust growth as the business recovers from the impact of COVID-19.
However, there is some uncertainty surrounding the ongoing lawsuits related to J&J's talcum powder business. In July, a potential $9 billion settlement was rejected by a judge during the bankruptcy proceedings of a J&J unit. Furthermore, in September, it was revealed that an additional 11,000 complaints had been filed.
Despite these challenges, the analysts remain cautiously optimistic about JNJ shares, given the positive improvements in the company's business this year and the completion of the KVUE separation, which enhances the overall investment story for J&J.
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