Johnson & Johnson (JNJ) closed the most recent trading day at $131.04, moving -1.48% from the previous trading session. This move was narrower than the S&P 500's daily loss of 1.6%. At the same time, the Dow lost 1.84%, and the tech-heavy Nasdaq lost 0.95%.
Prior to today's trading, shares of the world's biggest maker of health care products had lost 5.01% over the past month. This has lagged the Medical sector's loss of 4.88% and was narrower than the S&P 500's loss of 10.82% in that time.
JNJ will be looking to display strength as it nears its next earnings release, which is expected to be April 14, 2020. The company is expected to report EPS of $1.88, down 10.48% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $20.48 billion, up 2.27% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.94 per share and revenue of $84.89 billion. These totals would mark changes of +3% and +3.45%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for JNJ. Recent revisions tend to reflect the latest 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.
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 1.02% lower. JNJ is holding a Zacks Rank of #3 (Hold) right now.
In terms of valuation, JNJ is currently trading at a Forward P/E ratio of 14.88. Its industry sports an average Forward P/E of 12.84, 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 2.24. 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. The Large Cap Pharmaceuticals was holding an average PEG ratio of 1.77 at yesterday's closing price.
The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 43, putting it in the top 17% 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.
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