Back to top

Image: Bigstock

Johnson & Johnson (JNJ) Exceeds Market Returns: Some Facts to Consider

Read MoreHide Full Article

In the latest trading session, Johnson & Johnson (JNJ - Free Report) closed at $228.17, marking a +2.21% move from the previous day. This change outpaced the S&P 500's 0.41% gain on the day. At the same time, the Dow added 1.73%, and the tech-heavy Nasdaq lost 0.09%.

Shares of the world's biggest maker of health care products have depreciated by 0.61% over the course of the past month, underperforming the Medical sector's gain of 0.14%, and the S&P 500's gain of 4.59%.

Analysts and investors alike will be keeping a close eye on the performance of Johnson & Johnson in its upcoming earnings disclosure. The company's earnings report is set to go public on July 15, 2026. On that day, Johnson & Johnson is projected to report earnings of $2.83 per share, which would represent year-over-year growth of 2.17%. Meanwhile, our latest consensus estimate is calling for revenue of $25.04 billion, up 5.46% from the prior-year quarter.

For the full year, the Zacks Consensus Estimates are projecting earnings of $11.57 per share and revenue of $100.8 billion, which would represent changes of +7.23% and +7.02%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Johnson & Johnson. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.04% lower. Johnson & Johnson is currently sporting a Zacks Rank of #3 (Hold).

From a valuation perspective, Johnson & Johnson is currently exchanging hands at a Forward P/E ratio of 19.3. For comparison, its industry has an average Forward P/E of 14.87, which means Johnson & Johnson is trading at a premium to the group.

Also, we should mention that JNJ has a PEG ratio of 2.19. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As the market closed yesterday, the Large Cap Pharmaceuticals industry was having an average PEG ratio of 2.52.

The Large Cap Pharmaceuticals industry is part of the Medical sector. Currently, this industry holds a Zacks Industry Rank of 81, positioning it in the top 34% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

Zacks' 7 Best Strong Buy Stocks (New Research Report)

Valued at $99, click below to receive our just-released report predicting the 7 stocks that will soar highest in the coming month.

Click Here, It's Really Free

Published in