In the latest trading session, Johnson & Johnson (JNJ) closed at $163.18, marking a +0.27% move from the previous day. This change outpaced the S&P 500's 0.41% loss on the day.
Coming into today, shares of the world's biggest maker of health care products had lost 4.38% in the past month. In that same time, the Medical sector lost 6.22%, while the S&P 500 lost 5.13%.
Johnson & Johnson will be looking to display strength as it nears its next earnings release. In that report, analysts expect Johnson & Johnson to post earnings of $2.57 per share. This would mark a year-over-year decline of 1.15%. Meanwhile, our latest consensus estimate is calling for revenue of $23.55 billion, up 0.93% from the prior-year quarter.
JNJ's full-year Zacks Consensus Estimates are calling for earnings of $10.05 per share and revenue of $95.11 billion. These results would represent year-over-year changes of +2.55% and +1.43%, respectively.
It is also important to note the recent changes to analyst estimates for Johnson & Johnson. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Johnson & Johnson currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Johnson & Johnson has a Forward P/E ratio of 16.19 right now. For comparison, its industry has an average Forward P/E of 12.47, which means Johnson & Johnson is trading at a premium to the group.
Investors should also note that JNJ has a PEG ratio of 3.09 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Large Cap Pharmaceuticals stocks are, on average, holding a PEG ratio of 1.81 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 93, which puts it in the top 37% 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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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