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Johnson & Johnson (JNJ) Gains But Lags Market: What You Should Know

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Johnson & Johnson (JNJ - Free Report) closed at $139.04 in the latest trading session, marking a +0.89% move from the prior day. This change lagged the S&P 500's 1.47% gain on the day. Meanwhile, the Dow gained 2.32%, and the Nasdaq, a tech-heavy index, added 1.2%.

Prior to today's trading, shares of the world's biggest maker of health care products had lost 6.23% over the past month. This has lagged the Medical sector's loss of 0.38% and the S&P 500's gain of 0.74% in that time.

Investors will be hoping for strength from JNJ as it approaches its next earnings release, which is expected to be July 16, 2020. In that report, analysts expect JNJ to post earnings of $1.45 per share. This would mark a year-over-year decline of 43.8%. Our most recent consensus estimate is calling for quarterly revenue of $17.33 billion, down 15.73% from the year-ago period.

JNJ's full-year Zacks Consensus Estimates are calling for earnings of $7.68 per share and revenue of $79.48 billion. These results would represent year-over-year changes of -11.52% and -3.14%, respectively.

Investors might also notice recent changes to analyst estimates for JNJ. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. JNJ is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, JNJ is holding a Forward P/E ratio of 17.95. This valuation marks a premium compared to its industry's average Forward P/E of 14.63.

We can also see that JNJ currently has a PEG ratio of 3.01. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Large Cap Pharmaceuticals stocks are, on average, holding a PEG ratio of 2.08 based on yesterday's closing prices.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 29, which puts it in the top 12% 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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