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Johnson & Johnson (JNJ) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Johnson & Johnson (JNJ) closed the most recent trading day at $141.25, moving -0.63% from the previous trading session. This change lagged the S&P 500's daily gain of 0.83%. Elsewhere, the Dow gained 0.62%, while the tech-heavy Nasdaq added 1.43%.

Wall Street will be looking for positivity from JNJ as it approaches its next earnings report date. In that report, analysts expect JNJ to post earnings of $1.45 per share. This would mark a year-over-year decline of 43.8%. Our most recent consensus estimate is calling for quarterly revenue of $17.33 billion, down 15.73% from the year-ago period.

JNJ's full-year Zacks Consensus Estimates are calling for earnings of $7.68 per share and revenue of $79.48 billion. These results would represent year-over-year changes of -11.52% and -3.14%, respectively.

Any recent changes to analyst estimates for JNJ should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Within the past 30 days, our consensus EPS projection remained stagnant. 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 18.52. This valuation marks a premium compared to its industry's average Forward P/E of 14.77.

Also, we should mention that JNJ has a PEG ratio of 3.09. 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 2.04 at yesterday's closing price.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 15, putting it in the top 6% 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.

You can find more information on all of these metrics, and much more, on

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