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With a market cap of $394.2 billion, New Brunswick, New Jersey-based Johnson & Johnson (JNJ) is a global healthcare company with a diversified business model spanning pharmaceuticals, medical devices, and consumer health products. Its two main segments, Innovative Medicine and MedTech, offer a wide range of products, from prescription drugs in immunology, oncology, and infectious diseases to medical devices for surgery, orthopedics, and cardiovascular care.
Companies valued at $200 billion or more are generally considered “mega-cap” stocks and Johnson & Johnson fits this criterion perfectly. The company invests heavily in research and development, maintaining one of the largest R&D budgets in the pharmaceutical industry. J&J’s consumer health division includes well-known brands in baby care, skin health, oral care, and over-the-counter medicines.
The world's biggest maker of healthcare products has seen a 3.3% decline from its 52-week high of $168.85. Over the past three months, its shares have risen 5.1%, outperforming the broader Dow Jones Industrials Average's ($DOWI) 2.9% decline during the same period.
Longer term, JNJ is up 12.9% on a YTD basis, outpacing DOWI's 2.1% return. However, shares of Johnson & Johnson have gained 1.1% over the past 52 weeks, lagging behind Dow Jones’ 11.5% rise over the same time frame.
However, JNJ has exhibited a bullish trend, consistently trading above its 50-day moving average since late January. Additionally, the stock has maintained levels above its 200-day moving average since early February.
Despite reporting better-than-expected Q4 2024 adjusted EPS of $2.04 and revenue of $22.5 billion, JNJ shares fell 1.9% on Jan. 22 due to disappointing 2025 sales guidance. The company's projected 2025 revenue range of $89.2 billion - $90 billion fell short of the consensus estimate. Additionally, MedTech segment sales of $8.2 billion missed estimates, with management citing continued headwinds in China from the volume-based procurement (VBP) program and competitive pressures.
Moreover, JNJ has underperformed its rival, Eli Lilly and Company (LLY), with Eli Lilly experiencing a 16.9% YTD rise and a 19.1% gain over the past 52 weeks.
Analysts are moderately optimistic about JNJ's prospects, despite its underperformance compared to broader markets over the past year. With a consensus "Moderate Buy" rating from 22 analysts, the mean price target of $169.09 indicates a 3.7% premium to current levels.
