Johnson & Johnson’s (NYSE: JNJ) bottom line continues to be come under pressure from forex and generic competition, and the company faces sentiment-related headwinds, according to Raymond James.
These factors are already reflected in the share price, though, and growth is expected to accelerate toward the end of 2019 and into 2020, the sell-side firm said.
Analyst Jayson Bedford maintained an Outperform rating on Johnson & Johnson with a $145 price target.
Raymond James reduced its first-quarter EPS estimate from $2.11 to $1.95 and raised the second-quarter EPS estimate from $2.20 to $2.42.
The estimate adjustments reflect a shift in R&D assumptions and the timing of the Advanced Sterilization Products divestiture, Bedford said in a Friday note.
The divestiture is now expected to close early in the second quarter, the analyst said.
Raymond James' first-quarter estimate has been impacted by higher R&D assumptions due to the upfront payment of $300 million to Argenx SE (NASDAQ: ARGX) as part of a collaboration and license agreement, he said.
The analyst said no changes were made to revenue estimates.
Johnson & Johnson typically issues conservative guidance, which points toward some organic upside that could result from milder generic headwinds, a faster Spravato uptake and Erdafinitib approval, Bedford said.
Johnson & Johnson shares were down 0.27 percent at $136.51 at the time of publication Monday.
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Latest Ratings for JNJ
|Jan 2019||Wells Fargo||Maintains||Outperform||Outperform|
|Jan 2019||Morgan Stanley||Maintains||Equal-Weight||Equal-Weight|
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