Johnson & Johnson (JNJ) Up 8.9% Since Last Earnings Report: Can It Continue?

Core Viewpoint - Johnson & Johnson's recent earnings report shows a mixed performance with a slight sales increase but a decline in earnings, raising questions about future growth potential and market reactions leading up to the next earnings release [1][20]. Earnings Performance - Q4 2024 earnings were reported at $2.04 per share, beating the Zacks Consensus Estimate of $2.00, but reflecting a 10.9% decline year-over-year [2]. - Adjusted earnings, excluding certain expenses, were $1.41 per share, down 17.1% from the previous year [2]. - Total sales reached $22.52 billion, slightly exceeding the Zacks Consensus Estimate of $22.51 billion, with a year-over-year increase of 5.3% [3]. Sales Breakdown - Domestic sales rose 10% to $13.2 billion, while international sales declined 0.7% to $9.32 billion [4][5]. - The loss of exclusivity for Stelara negatively impacted revenue growth by 290 basis points [4]. Segment Performance - Innovative Medicines segment sales increased 4.4% to $14.33 billion, driven by key products like Darzalex and Tremfya, despite a decline in Stelara sales [6][7]. - MedTech segment sales were $8.19 billion, up 6.7% year-over-year, but missed estimates due to competitive pressures and challenges in China [16][18]. Future Guidance - For 2025, the company expects sales between $89.2 billion and $90.0 billion, indicating growth of 0.5%-1.5% [21]. - Adjusted earnings per share are projected to be in the range of $10.50-$10.70, suggesting growth of 5.2% to 7.2% [24]. - The company anticipates operational sales growth to be stronger in the second half of 2025 compared to the first half [24]. Market Sentiment - Recent estimates for the stock have been trending downward, indicating a cautious outlook among investors [27][29]. - Johnson & Johnson currently holds a Zacks Rank 3 (Hold), suggesting an expectation of in-line returns in the near term [29].