Johnson & Johnson (JNJ) Outpaces Stock Market Gains: What You Should Know
Johnson & Johnson (JNJ) closed at $165.37 in the latest trading session, marking a +0.25% move from the prior day. This move outpaced the S&P 500's daily gain of 0.18%.
Heading into today, shares of the world's biggest maker of health care products had lost 3.09% over the past month, lagging the Medical sector's gain of 4.62% and the S&P 500's gain of 2.43% in that time.
Investors will be hoping for strength from JNJ as it approaches its next earnings release, which is expected to be July 21, 2021. In that report, analysts expect JNJ to post earnings of $2.28 per share. This would mark year-over-year growth of 36.53%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $22.27 billion, up 21.45% from the year-ago period.
JNJ's full-year Zacks Consensus Estimates are calling for earnings of $9.51 per share and revenue of $91.77 billion. These results would represent year-over-year changes of +18.43% and +11.13%, respectively.
It is also important to note the recent changes to analyst estimates for JNJ. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.11% lower. JNJ is holding a Zacks Rank of #3 (Hold) right now.
Looking at its valuation, JNJ is holding a Forward P/E ratio of 17.35. Its industry sports an average Forward P/E of 14.8, so we one might conclude that JNJ is trading at a premium comparatively.
It is also worth noting that JNJ currently has a PEG ratio of 2.65. 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 2.11 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 203, which puts it in the bottom 21% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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