Johnson & Johnson (JNJ) is set to report its Q1 2024 results on April 16, with expectations of revenue reaching $21.5 billion and earnings of $2.68. The company is anticipated to benefit from higher MedTech sales and strong growth in pharmaceuticals, driven by products such as Darzalex, Stelara, and Tremfya. JNJ’s performance in recent years has been volatile, with the stock underperforming the S&P 500 in some years. However, from a valuation perspective, JNJ stock appears to have room for growth, with a forecast of $180 per share, reflecting a potential 20% upside.
Despite facing some headwinds such as biosimilar competition for Stelara later this year, JNJ is expected to perform well in the latest quarter. The company’s pharmaceuticals business, particularly driven by Darzalex and Stelara, has been a key growth driver. Additionally, new drugs like Carvykti and Spravato are gaining market share. On the MedTech side, recent acquisitions like Abiomed and Laminar are likely to contribute to overall segment growth. In the previous quarter, JNJ’s revenue was up 7% year-over-year, with growth in both the pharmaceuticals and MedTech businesses.
Looking ahead, JNJ’s future performance will depend on how it navigates through the challenges it faces, including biosimilar competition for Stelara in 2025. Despite these near-term headwinds, the company is expected to continue to deliver strong results. While JNJ stock has seen a 6% decline year-to-date, it is believed that the potential risks are already priced in. The company’s efforts to diversify its product offerings and strengthen its position in the market are likely to drive growth in the long term.
In the context of the current uncertain macroeconomic environment, with high oil prices and elevated interest rates, it remains to be seen whether JNJ will outperform or underperform the S&P 500 over the next 12 months. However, based on historical performance and valuation metrics, JNJ stock appears to have the potential for growth. With an estimated valuation of $180 per share and expected earnings of $10.70 per share for the full-year 2024, the stock could see upside potential. As the company continues to focus on innovation and market expansion, investors are optimistic about JNJ’s prospects.
In conclusion, Johnson & Johnson’s upcoming earnings report will shed light on its performance in Q1 2024. With expectations of strong revenue and earnings growth driven by pharmaceuticals and MedTech sales, the company is well-positioned for the future. Despite facing challenges such as biosimilar competition and market volatility, JNJ’s efforts to expand its product offerings and strengthen its position in the market are likely to drive long-term growth. Investors will keenly watch the earnings report to gain insights into JNJ’s performance and outlook for the rest of the year.
