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Johnson & Johnson (JNJ) Stock Sinks As Market Gains: What You Should Know

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Johnson & Johnson (JNJ - Free Report) closed at $165.64 in the latest trading session, marking a -0.04% move from the prior day. This change lagged the S&P 500's daily gain of 1.06%. Elsewhere, the Dow gained 0.71%, while the tech-heavy Nasdaq added 0.09%.

Heading into today, shares of the world's biggest maker of health care products had gained 0.25% over the past month, outpacing the Medical sector's loss of 1.69% and the S&P 500's loss of 1.14% in that time.

Investors will be hoping for strength from Johnson & Johnson as it approaches its next earnings release, which is expected to be October 18, 2022. The company is expected to report EPS of $2.57, down 1.15% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $23.55 billion, up 0.93% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $10.05 per share and revenue of $95.11 billion, which would represent changes of +2.55% and +1.43%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Johnson & Johnson. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.02% lower within the past month. Johnson & Johnson is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Johnson & Johnson has a Forward P/E ratio of 16.49 right now. Its industry sports an average Forward P/E of 12.79, so we one might conclude that Johnson & Johnson is trading at a premium comparatively.

Investors should also note that JNJ has a PEG ratio of 3.15 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Large Cap Pharmaceuticals industry currently had an average PEG ratio of 1.93 as of yesterday's close.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 100, which puts it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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