Core Insights - Mar Vista U.S. Quality Strategy reported a net-of-fees gain of +0.20% in Q4 2025, underperforming the Russell 1000® Index (+2.41%) and the S&P 500® Index (+2.65%) [1] - The U.S. equity market experienced strong momentum in 2025, marking its second consecutive year of double-digit gains, with a rapid recovery from a bear market dip in April [1] - The market leadership was dominated by Mega-cap stocks and AI-driven companies, leading to a narrowing of market leadership [1] Performance Analysis - Stock selection in the communication services, consumer discretionary, and financials sectors positively impacted performance, while selections in information technology, materials, and healthcare detracted from it [1] - Johnson & Johnson (NYSE: JNJ) was highlighted as one of the strongest-performing holdings, with a one-month return of 0.20% and a 52-week gain of 44.88% [2] - Johnson & Johnson's market capitalization stood at $505.28 billion as of January 12, 2026 [2] Company Insights - Johnson & Johnson's strong Q4 performance was attributed to robust financial results, upward guidance revisions, and growth in its pharmaceutical and medical technology segments [3] - The company is expected to achieve 5-7% revenue growth through 2030, which exceeds consensus estimates [3]

Core Insights - Johnson & Johnson's (JNJ) MedTech segment accounts for approximately 36% of total revenues and focuses on high-growth markets, particularly in cardiovascular interventions [2][3] MedTech Segment Performance - Sales in the MedTech business have improved over the past two quarters, driven by acquisitions of Abiomed and Shockwave, as well as growth in Surgical Vision and wound closure [4] - The MedTech segment is expected to maintain strong momentum in Cardiovascular, Surgery, and Vision, supported by the adoption of newly launched products [4] Challenges and Strategic Moves - J&J faces challenges in the Chinese market due to the volume-based procurement (VBP) program, which is impacting sales [5] - The company plans to separate its Orthopaedics franchise into a standalone company, DePuy Synthes, to enhance growth and margins [6] Future Outlook - J&J anticipates better growth in the MedTech business by 2026, driven by new product launches and a focus on high-growth markets [7] - The company expects a compound annual growth rate (CAGR) of around 5.4% for the MedTech unit over the next three years [8] Competitive Landscape - J&J's MedTech unit competes with major players like Medtronic, Abbott, Stryker, and Boston Scientific, each specializing in various medical device sectors [9][10] Financial Performance - J&J's shares have outperformed the industry, rising 44.9% over the past year compared to a 21.9% increase in the industry [12] - The company's shares are currently trading at a price/earnings ratio of 18.22, higher than the industry average of 17.56 [14] Earnings Estimates - The Zacks Consensus Estimate for J&J's 2026 earnings has slightly increased from $11.47 to $11.48 over the past 30 days [15]

Core Insights - Johnson & Johnson is presenting 11 abstracts at the 64th Annual Meeting of the American College of Neuropsychopharmacology, focusing on advancements in neuropsychiatry, particularly in major depressive disorder (MDD) and treatment-resistant depression (TRD) [1][2] Group 1: Research Presentations - Key presentations include analyses of CAPLYTA (lumateperone) for remission in MDD, metabolic profiles of seltorexant versus quetiapine XR in MDD with insomnia, and effects of SPRAVATO (esketamine) on anhedonia in TRD [3][4] - Specific posters will cover the efficacy of lumateperone in various demographic and clinical subgroups, as well as treatment-emergent adverse events in MDD patients [3][4] Group 2: Company Commitment - Johnson & Johnson emphasizes its commitment to addressing unmet needs in depression, schizophrenia, and bipolar disorder, aiming for disease remission through innovative research and clinical findings [2] - The company is advancing its portfolio with a focus on novel mechanisms and AI-driven precision tools to redefine standards of care in neuropsychiatry [2] Group 3: Major Depressive Disorder (MDD) Insights - MDD affects approximately 332 million people globally, representing about 4% of the population, with around 22 million adults in the U.S. experiencing at least one major depressive episode in 2023 [6] - The disorder is complex and heterogeneous, with responses to treatment varying widely, highlighting the need for personalized approaches [6][7] - Approximately 60% of MDD patients experience insomnia symptoms, which significantly impact their quality of life and increase the risk of depressive relapse [7] Group 4: Treatment-Resistant Depression (TRD) Insights - About one-third of adults with MDD are classified as having TRD, defined as inadequate response to two or more oral antidepressants [8] - TRD poses a significant economic burden and affects patients' lives severely, with a high percentage not achieving remission even after multiple treatment attempts [8]

Investment Rating - The report maintains a positive outlook on the development of dual and triple antibodies in multiple myeloma (MM) and recommends monitoring the progress of TCE monotherapy and combination therapies in MM, including the EMD population [1][15]. Core Insights - The 67th ASH Annual Meeting highlighted significant advancements in hematology, particularly in the treatment of multiple myeloma, diffuse large B-cell lymphoma (DLBCL), and chronic lymphocytic leukemia/small lymphocytic lymphoma (CLL/SLL) [31]. - In multiple myeloma, the Tec-Dara combination therapy demonstrated a 36-month overall survival (OS) rate of 83.3%, significantly higher than the 65.0% in the control group, with a hazard ratio (HR) of 0.46 [32]. - The MSD ROR1 ADC showed promising first-line potential in DLBCL, with 24-month OS and progression-free survival (PFS) rates of 94% and 84%, respectively, outperforming existing treatments [33]. - Eli Lilly's Pirto showed improved PFS and OS trends compared to BR, but the executive admitted it may not become the first-line choice for CLL/SLL due to limited follow-up data and current treatment practices favoring covalent BTK inhibitors [34]. Summary by Sections 1. R/R MM: Focus on Dual/Triple Antibodies and TCE Therapies - Johnson & Johnson's BCMA/CD3+daratumumab therapy received FDA's "National Priority Voucher," reducing review time to 1-2 months, showing excellent efficacy in high-risk patients [7][15]. - IBI3003 from Innovent demonstrated an overall response rate (ORR) of 83.3% in high-risk patients, with a 100% minimal residual disease (MRD) negative rate in those achieving complete response (CR) [16]. - AstraZeneca's AZD0120 (BCMA/CD19 CAR-T) is projected to exceed $5 billion in sales, with a 100% ORR in treated patients [20][21]. 2. DLBCL: MSD ROR1 ADC Shows First-Line Potential - The MSD ROR1 ADC demonstrated a 24-month OS rate of 94% and a PFS rate of 84%, outperforming R-CHOP and Pola-CHP treatments [22][23]. - In high-risk populations, the ORR was 75% for patients with extramedullary disease (EMD), with a 100% ORR in the 1200 µg/kg dose group [23]. 3. CLL/SLL: Pirto May Not Become First-Line Choice - Pirto vs BR showed a 24-month PFS of 93.4% vs 70.7%, but the data is still immature, with a median follow-up of 28 months [25][27]. - The safety profile of Pirto indicated a 40% incidence of grade 3 or higher treatment-emergent adverse events (TEAEs), compared to 67.4% for BR [25][27].

Company Performance - Johnson & Johnson (JNJ) closed at $209.72, with a daily increase of +2.61%, outperforming the S&P 500's gain of 0.16% [1] - Prior to this trading day, JNJ shares had decreased by 3.4%, underperforming the Medical sector's gain of 2.84% and the S&P 500's gain of 1.89% [1] Upcoming Earnings - The upcoming earnings report is expected on January 21, 2026, with an anticipated EPS of $2.52, reflecting a 23.53% increase year-over-year [2] - Revenue is projected to be $24.11 billion, indicating a 7.06% increase compared to the same quarter of the previous year [2] Full Year Projections - For the full year, earnings are projected at $10.86 per share, representing an increase of +8.82%, while revenue is expected to remain flat at $93.7 billion [3] Analyst Forecasts - Recent revisions to analyst forecasts are crucial, as upward revisions indicate positive sentiment regarding the company's business operations and profit generation capabilities [4] - Adjustments in estimates are linked to stock price performance, suggesting that investors can benefit from tracking these changes [5] Zacks Rank and Valuation - Johnson & Johnson currently holds a Zacks Rank of 3 (Hold), with a Forward P/E ratio of 17.8, which is higher than the industry's Forward P/E of 15.26 [6] - The company has a PEG ratio of 2.1, compared to the Large Cap Pharmaceuticals industry's average PEG ratio of 1.59 [7] Industry Context - The Large Cap Pharmaceuticals industry, part of the Medical sector, has a Zacks Industry Rank of 185, placing it in the bottom 25% of over 250 industries [7][8] - The Zacks Industry Rank indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]

Core Point - Johnson & Johnson successfully persuaded Delaware's highest court to dismiss a portion of a $1 billion damages award related to its breach of a 2019 agreement to acquire Auris Health, a company specializing in surgical robots [1] Group 1 - The court ruling specifically addresses the damages awarded for the breach of the acquisition agreement [1] - The original agreement involved Johnson & Johnson's intention to purchase Auris Health, which focuses on innovative surgical robotics [1] - The decision may have implications for future mergers and acquisitions in the healthcare technology sector [1]

Market Overview - The U.S. stock market experienced a mixed trading environment on January 12th, 2026, with the Dow Jones Industrial Average increasing by 24.69 points (0.0499%) and Dow Futures rising by 26.00 points (0.0523%) [1][2]. Political Developments - Significant political developments influenced market sentiment, particularly the initiation of a criminal investigation by the Justice Department into Fed Chair Jerome Powell regarding his testimony on Fed building renovations, which Powell claims undermines the central bank's independence [2]. - President Donald Trump proposed a one-year, 10% cap on credit card interest rates, which is expected to have a direct impact on the financial sector [2]. Sector Performance - Walmart (WMT) was the top gainer among Dow components, rising by 3.20%, followed by Caterpillar (CAT) with a 1.92% increase and Johnson & Johnson (JNJ) up by 1.85% [3]. - The financial sector faced challenges due to political announcements, with American Express (AXP) experiencing the largest decline at 4.02%, followed by Disney (DIS) down 2.42% and JPMorgan Chase (JPM) falling by 2.03% [3].

Core Viewpoint - The company is entering a cycle of accelerated growth, with expectations for better performance in 2026 compared to 2025, and visibility for double-digit growth in the later part of the decade [3]. Group 1: Company Performance - The company had significant outperformance in 2025, which sets a positive tone for future growth [1][3]. - The company is projected to become the largest healthcare company with over $100 billion in sales [3]. Group 2: Future Outlook - There is optimism regarding the growth cycle that the company is initiating, with expectations for continued improvement in performance [3].

Johnson & Johnson (NYSE: JNJ) FY Conference Summary Company Overview - **Company**: Johnson & Johnson (J&J) - **Date of Conference**: January 12, 2026 - **Speaker**: Joaquin Duato, Chairman and CEO Key Points Company Performance and Growth Outlook - J&J experienced significant outperformance in 2025, with expectations for continued growth in 2026, projecting double-digit growth later in the decade [4][8] - The company is on track to become the largest healthcare company with over $100 billion in sales [4] - The innovative medicine group, excluding Stelara, grew by 16% in Q3, highlighting strong fundamentals [4] Strategic Focus Areas - J&J is focused on six key areas: - **Innovative Medicine**: Oncology, Immunology, Neuroscience - **Medical Technology**: Cardiovascular, Surgery, Vision [4] - The company plans to launch approximately a dozen new products, including Icotrokinra and a new coronary catheter in 2026 [5][6] Pipeline and Product Development - Recent advancements include the filing of Ottava, a robotic soft tissue surgical system, and the acquisition of Halda, a precision oncology platform [7] - The company aims to invest $55 billion in R&D, technology, and manufacturing in the U.S. to enhance local production of advanced medicines [10] Industry Policy Environment - J&J has reached agreements with the government to open access and lower prices for medicines, which is expected to positively impact the company and the industry [9][10] - The agreements also include exemptions on pharmaceutical tariffs, alleviating previous policy overhangs [9] Financial Position - J&J maintains a strong financial position with a triple-A rated balance sheet and robust cash flow, allowing for simultaneous investment and shareholder returns [7][8] Growth Drivers in Pharmaceuticals - **Oncology**: Targeting $50 billion in sales by 2030, with strong products like Darzalex and Rybrevant [14][18] - **Immunology**: Tremfya is expected to exceed $10 billion in sales, with Icotrokinra set to expand market access as the first oral IL-23 blocker [16][26] - **Neuroscience**: Spravato and Caplyta are highlighted as significant growth drivers, with Caplyta projected to exceed $5 billion [36] MedTech Business Strategy - J&J is focusing on high-growth areas in MedTech, particularly in cardiology, surgery, and vision, with plans to separate the orthopedics franchise to enhance growth and margins [39][46] - Key priorities include advancing cardiac ablation technologies and establishing a strong presence in robotic surgery with Ottava and Monarch [41][44] Future Milestones - Anticipated approvals in 2026 include Ottava for robotic surgery and new products in cardiology and surgery [49] - The robotic platform is expected to contribute significantly to growth from 2028 onwards [50] Business Development Strategy - J&J will continue to focus on early-stage deals for portfolio expansion, with a strong emphasis on identifying transformative technologies [52][53] Conclusion - J&J is entering a cycle of accelerated growth with multiple drivers, projecting a better performance in 2026 compared to 2025, and aiming for double-digit growth by the end of the decade [54]

Core Insights - The J.P. Morgan conference is recognized as the largest healthcare conference of the year, attracting thousands of investors, analysts, and executives [1] Company and Industry Summary - The first morning of the conference did not witness any significant deal announcements, indicating a potentially cautious atmosphere among participants [1]