Johnson & Johnson (NYSE: $JNJ) is an American multinational pharmaceutical and medical technologies corporation headquartered in New Brunswick, New Jersey, founded by three brothers in 1886. The company owns many household names in the healthcare consumer products sectors.
It reported its first-quarter financial results for fiscal 2024 on Tuesday, April 16, 2024, showcasing a mixed performance amidst a dynamic healthcare landscape.
Johnson & Johnson Q1 Results
Johnson & Johnson reported a strong performance in the first quarter of 2024, showcasing its ability to navigate the dynamic healthcare landscape. The pharma giant reported adjusted earnings per share (EPS) of $2.71, a 12.4% increase year-over-year, surpassing the consensus estimate of $2.64.
Sales reached $21.38 billion, a 2.3% year-over-year increase, narrowly missing the consensus of $21.39 billion. Operational growth stood at 3.9%, with adjusted operational growth reaching 4.0%. Notably, it reported a net profit of $5.35 billion, a significant improvement from the net loss of $491 million in the same period last year, which included $6.9 billion in litigation charges.
The Innovative Medicine segment was a standout performer, with worldwide operational sales, excluding the COVID-19 vaccine, growing 8.3% to $13.6 billion. Key products like the psoriasis drug Stelara and the cancer treatment Darzalex contributed to this strong performance. Additionally, the company’s medical devices business saw a 4.5% year-over-year increase, driven by electrophysiology, cardiovascular, and general surgery product growth.
The company’s worldwide sales increased by 3.9%, driven by a notable 7.8% growth in the U.S. market. This top-line growth was accompanied by improvements in profitability, as the company’s adjusted net earnings and adjusted diluted earnings per share rose by 3.8% and 12.4%, respectively, compared to the same period in 2023.
Recognizing the company’s financial strength, Johnson & Johnson also announced a quarterly dividend increase of 4.2%, from $1.19 to $1.24 per share.
JNJ 2024 Guidance
Despite the solid performance in the first quarter, Johnson & Johnson faced some challenges, particularly in its international markets and within specific product lines. Sales outside the U.S. declined by 0.3%, indicating headwinds in certain global regions. The company’s Contact Lens business also saw a 2.3% decline, driven by U.S. stocking dynamics.
To address these challenges, the company has remained focused on its strategic priorities, including strengthening its pipeline, driving commercial excellence, and optimizing its operations. Recent regulatory and clinical milestones, such as FDA approvals and positive study results, have bolstered the company’s confidence in its ability to maintain its growth trajectory.
Looking ahead, the company has narrowed its full-year 2024 guidance. The company now forecasts total sales between $88 billion and $88.4 billion, compared to the previous range of $87.8 billion to $88.6 billion. The company’s adjusted EPS guidance has also been adjusted to $10.57 to $10.72, down from the previous range of $10.55 to $10.75.
Despite the slightly revised guidance, management remains confident in its ability to deliver above-market growth and continue creating value for its shareholders. The company is focused on executing its strategic priorities, leveraging its diverse portfolio, and investing in innovative solutions.
Johnson & Johnson Segment Performance
The Innovative Medicine segment reported a 2.5% worldwide sales increase, driven by the strong performance of key brands and the successful uptake of recently launched products. Notable contributors included the company’s immunology and oncology portfolios, with standout products such as Stelara and Darzalex showcasing solid growth.
The MedTech segment delivered an impressive 6.3% sales increase globally, with strong growth in both the U.S. and international markets. This performance was supported by the company’s electrophysiology products and the Abiomed cardiovascular business and robust growth in wound closure products within the General Surgery division.
JNJ Stock Performance
Johnson & Johnson’s stock (NYSE: $JNJ) traded down by over 2.13% on the day following the release of its first-quarter 2024 earnings report. The stock closed at $144.45, a decline of $3.14 compared to the previous trading day. On Wednesday, April 17, the stock recouped some of the previous day’s losses, rising by 0.24% to $144.79 as of 9:33 AM EDT.
Tuesday’s decline was steeper than the 0.2% decline of the broader S&P 500 index, indicating that investors were not entirely satisfied with the company’s mixed quarterly results. The lowered top end of Johnson & Johnson’s full-year guidance range likely contributed to the stock’s sell-off, as the market reacted cautiously to the company’s revised outlook.
Should You Consider Buying Johnson & Johnson Stock in 2024?
While Johnson & Johnson’s first-quarter results showed mixed performance, it remains a diversified healthcare leader with a strong portfolio and pipeline. Investors should thoroughly evaluate the company’s long-term growth potential and the risks and opportunities before deciding whether to invest in JNJ stock in 2024. A balanced assessment of all available information is advisable when making investment decisions.
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