Johnson & Johnson expects at least $3 billion in sales of its Covid vaccine this year, and JNJ stock ticked higher Tuesday despite a mixed fourth-quarter report.
For the year, the medical giant projected $3 billion to $3.5 billion in sales of its single-shot vaccine. This suggests other Covid vaccine makers — including Pfizer and Moderna — could see an increase in 2022 demand as well, Mizuho Securities analyst Vamil Divan said in a report to clients.
The news comes as the omicron variant continues to spread across the U.S. and world, and amid new reports of an omicron offshoot variant, dubbed BA.2. Details are preliminary, but the variant appears to have different mutations from omicron. It has been nicknamed "stealth omicron."
Still, Edward Jones analyst Ashtyn Evans doesn't expect the Covid vaccine to be a long-term driver for Johnson & Johnson. Instead, she has a buy rating on JNJ stock as "one of the largest and most diverse health care companies in the world."
On the stock market today, JNJ stock advanced 2.9% to 167.63. That flipped a downtrend that began Jan. 10, according to MarketSmith.com.
JNJ Stock: Mixed Quarterly Report
Fourth-quarter results were mixed with $28.4 billion in sales missing forecasts for $25.28 billion, according to FactSet. Adjusted profit of $2.13 per share beat by a penny driven by higher-than-expected Covid vaccine sales, Evans said in her note to clients.
On a year-over-year basis, sales grew more than 10% and earnings advanced almost 15%.
"Strong year-over-year sales growth was driven by innovative new drug sales and a recovery in the device business compared with 2020," Evans said. "In 2022, we expect continued strong above-market sales growth in the pharma business, and medical-device procedures to reach pre-pandemic numbers by the end of the year."
The medical devices segment generated $27.06 billion in sales, posting the best growth among the company's business segments, at nearly 18%. Drug sales rose more than 14% to $52.08 billion. The consumer health business brought in $14.64 billion in sales, growing north of 4%.
For 2022, the pharmaceutical giant expects to earn $10.40-$10.60 per share on $98.9 billion to $100.4 billion in sales. The sales estimate includes a potential $3 billion to $3.5 billion from its Covid vaccine.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
