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J&J's MedTech Segment Eyes Another Strong Quarter in Q2
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Key Takeaways
J&J's MedTech unit is expected to see Q2 strength in Cardiovascular, Surgery and Vision.
JNJ continues to face China sales pressure from the government's volume-based procurement program.
J&J expects MedTech growth in 2026 to exceed 2025, driven by newly launched products.
Johnson & Johnson's (JNJ - Free Report) MedTech division, which includes orthopedics, surgery, cardiovascular, electrophysiology, vision and wound closure products, contributes roughly 36% to the company’s total revenues.
J&J is repositioning its MedTech portfolio toward more innovative, faster-growing areas, most notably cardiovascular. With the acquisitions of Shockwave in 2024 and Abiomed in 2022, J&J has become a category leader in four of the largest and highest-growth cardiovascular intervention MedTech markets. J&J is the market leader in heart recovery, circulatory restoration and electrophysiology.
J&J’s MedTech business has improved in the last four quarters, driven by the acquired cardiovascular businesses, Abiomed and Shockwave, as well as Surgical Vision and wound closure in Surgery. J&J’s electrophysiology business has also improved significantly in recent quarters, driven by new product launches, including Varipulse and better commercial execution.
Investors are likely to have closely monitored the segment's performance in the second quarter to gauge whether these factors continue to drive MedTech’s growth. J&J is scheduled to report second-quarter 2026 results on July 15.
In the first quarter of 2026, J&J delivered nearly $8.64 billion in sales in its MedTech segment, reflecting growth of 4.6% on an operational basis. The positive trend is expected to have continued in the second quarter. The MedTech business is expected to have seen strong momentum in three focus areas: Cardiovascular, Surgery and Vision in the second quarter, backed by increased adoption of newly launched products. Orthopedics is likely to have grown at a more moderate pace.
However, the company continues to face headwinds in China. Sales in China are being hurt by the impact of the volume-based procurement (VBP) program, which is a government-driven cost containment effort in China. Sales in China are likely to have been hurt by the impact of the VBP program in the second quarter.
On the conference call, investors will also look for updates on the MedTech unit’s outlook for 2026. J&J had earlier said that it expects better growth in the MedTech business in 2026 than 2025 levels, driven by increased adoption of newly launched products across Cardiovascular, Surgery and Vision portfolios. Also, J&J expects continued impacts from VBP issues in China in 2026, mainly in the second half.
Another quarter of mid-single-digit or better operational sales growth would reinforce investor confidence that MedTech can remain a reliable long-term growth engine alongside J&J’s pharmaceutical business.
J&J’s Key Competitors in the Medical Devices Market
J&J’s MedTech unit faces strong competition from several major players in the medical device industry, like Medtronic (MDT - Free Report) , Abbott, Stryker (SYK - Free Report) and Boston Scientific (BSX - Free Report) .
While Medtronic has a strong presence in cardiovascular, neuroscience and surgical technologies, Stryker is a major player in orthopedics and surgical equipment. Boston Scientific markets products for cardiovascular, endoscopy, urology and neuromodulation. Abbott is known for its medical device products across cardiovascular, diagnostics and diabetes care.
JNJ’s Price Performance, Valuation and Estimates
J&J’s shares have outperformed the industry so far this year. The stock has risen 28.5% this year compared with 15.3% appreciation of the industry.
Image Source: Zacks Investment Research
From a valuation standpoint, J&J is slightly expensive. Going by the price/earnings ratio, the company’s shares currently trade at 21.74 forward earnings, higher than 19.11 for the industry. The stock is also trading above its five-year mean of 15.65.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings has been stable at $11.57 per share over the past 60 days, while that for 2027 earnings has gone up from $12.58 per share to $12.61 over the same time frame.
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J&J's MedTech Segment Eyes Another Strong Quarter in Q2
Key Takeaways
Johnson & Johnson's (JNJ - Free Report) MedTech division, which includes orthopedics, surgery, cardiovascular, electrophysiology, vision and wound closure products, contributes roughly 36% to the company’s total revenues.
J&J is repositioning its MedTech portfolio toward more innovative, faster-growing areas, most notably cardiovascular. With the acquisitions of Shockwave in 2024 and Abiomed in 2022, J&J has become a category leader in four of the largest and highest-growth cardiovascular intervention MedTech markets. J&J is the market leader in heart recovery, circulatory restoration and electrophysiology.
J&J’s MedTech business has improved in the last four quarters, driven by the acquired cardiovascular businesses, Abiomed and Shockwave, as well as Surgical Vision and wound closure in Surgery. J&J’s electrophysiology business has also improved significantly in recent quarters, driven by new product launches, including Varipulse and better commercial execution.
Investors are likely to have closely monitored the segment's performance in the second quarter to gauge whether these factors continue to drive MedTech’s growth. J&J is scheduled to report second-quarter 2026 results on July 15.
In the first quarter of 2026, J&J delivered nearly $8.64 billion in sales in its MedTech segment, reflecting growth of 4.6% on an operational basis. The positive trend is expected to have continued in the second quarter. The MedTech business is expected to have seen strong momentum in three focus areas: Cardiovascular, Surgery and Vision in the second quarter, backed by increased adoption of newly launched products. Orthopedics is likely to have grown at a more moderate pace.
However, the company continues to face headwinds in China. Sales in China are being hurt by the impact of the volume-based procurement (VBP) program, which is a government-driven cost containment effort in China. Sales in China are likely to have been hurt by the impact of the VBP program in the second quarter.
On the conference call, investors will also look for updates on the MedTech unit’s outlook for 2026. J&J had earlier said that it expects better growth in the MedTech business in 2026 than 2025 levels, driven by increased adoption of newly launched products across Cardiovascular, Surgery and Vision portfolios. Also, J&J expects continued impacts from VBP issues in China in 2026, mainly in the second half.
Another quarter of mid-single-digit or better operational sales growth would reinforce investor confidence that MedTech can remain a reliable long-term growth engine alongside J&J’s pharmaceutical business.
J&J’s Key Competitors in the Medical Devices Market
J&J’s MedTech unit faces strong competition from several major players in the medical device industry, like Medtronic (MDT - Free Report) , Abbott, Stryker (SYK - Free Report) and Boston Scientific (BSX - Free Report) .
While Medtronic has a strong presence in cardiovascular, neuroscience and surgical technologies, Stryker is a major player in orthopedics and surgical equipment. Boston Scientific markets products for cardiovascular, endoscopy, urology and neuromodulation. Abbott is known for its medical device products across cardiovascular, diagnostics and diabetes care.
JNJ’s Price Performance, Valuation and Estimates
J&J’s shares have outperformed the industry so far this year. The stock has risen 28.5% this year compared with 15.3% appreciation of the industry.
From a valuation standpoint, J&J is slightly expensive. Going by the price/earnings ratio, the company’s shares currently trade at 21.74 forward earnings, higher than 19.11 for the industry. The stock is also trading above its five-year mean of 15.65.
The Zacks Consensus Estimate for 2026 earnings has been stable at $11.57 per share over the past 60 days, while that for 2027 earnings has gone up from $12.58 per share to $12.61 over the same time frame.
J&J has a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.