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J&J Q2 Earnings 2017
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After Johnson & Johnson Earnings, Buy These Pharma Stocks
Jul 14, 2017 | Yahoo! Finace
Shares of Johnson & Johnson JNJ slid nearly 3.5% in morning trading Tuesday after the pharma giant’s first-quarter earnings results were met with mixed reactions from investors. -
Dow closes 100 points lower after Goldman shocks Street with earnings miss
Jul 14, 2017 | CNBC
The Dow Jones industrial average closed about 110 points lower, with Goldman shaving off 73 points and Johnson & Johnson taking out 26 points. -
Valuation Concerns at J&J
Jul 14, 2017 | Morningstar
Johnson & Johnson (JNJ) reported first-quarter results largely in line with our expectations, and we don’t expect any major changes to our $108 fair value estimate -
Johnson & Johnson Sees Little Impact In Key Area Despite Pfizer Competition
Jul 14, 2017 | The Street
In the first quarter of 2017, Johnson & Johnson (JNJ) saw "very little impact" from biosimilar competition to Remicade in the U.S., said chief financial officer Dominic Caruso on an earnings call Tuesday. -
Johnson & Johnson: Help Me Actelion, You’re My Only Hope
Jul 14, 2017 | Barron's
Shares of Johnson & Johnson (JNJ) are on pace for their biggest drop since March 2009 after the health-care giant reported disappointing earnings.
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After Johnson & Johnson Earnings, Buy These Pharma Stocks
Jul 14, 2017 | Yahoo! Finace
Shares of Johnson & Johnson JNJ slid nearly 3.5% in morning trading Tuesday after the pharma giant’s first-quarter earnings results were met with mixed reactions from investors. As the sell-off continues, investors focused on large-cap pharma companies may want to move their money into stronger options this earnings season.
JNJ Earnings
For the first quarter, Johnson & Johnson posted earnings of $1.83 per share, beating the Zacks Consensus Estimate of $1.77. Revenues, on the other hand, came in below expectations. Johnson & Johnson posted quarterly revenues of $17.8 billion, which missed our consensus estimate of $18.0 billion.
The company’s Worldwide Pharmaceutical segment grew 0.8% year-over-year, with domestic pharma sales slipping 1.3% and international pharma sales growing 4.1%. Johnson & Johnson also said that its recent purchase of Actelion ALIOF should close in the second quarter.
Like many of its peers, Johnson & Johnson is facing generic competition and pricing pressure for some its pharma products, especially in the United States. Today’s price action most likely reflects investors’ hesitation towards the company’s slumping domestic sales figures.
Other Pharma Stocks to Buy
Johnson & Johnson is often considered a bellwether for the large-cap pharma industry, and while its earnings beat is hopefully a sign of things to come, there appear to other companies that are better positioned to post strong results this quarter.
One company to consider is Roche Holding AG RHHBY. This Swiss healthcare giant has a strong presence in the cancer, immunology, infectious diseases, and ophthalmology markets. The company has a deep pipeline and is working to build up its offerings in immuno-oncology market.
Roche has key data readouts lined up for 2017 and has already gained FDA approval for an important drug Ocrevus (MS) this year. The stock has outperformed its industry peers so far this year, and its Zacks Rank #1 (Strong Buy) pairs well with its “B” grades for Growth and Momentum headed into its earnings announcement.
Another stock to look at is Sanofi SNY. Sanofi has averaged an earnings beat of 4.77% over the last four quarters, and its fundamental metrics make it appealing for value-minded investments. Its Forward P/E ratio of 14.44 outpaces the industry average of 15.5, and its P/S ratio of 3.0 comes in better than the industry’s 4.1. Moreover, the P/B ratio for Sanofi is 1.8, less than 4.3 for the industry. These metrics have helped the stock earn an “A” grade for Value.
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Dow closes 100 points lower after Goldman shocks Street with earnings miss
Jul 14, 2017 | CNBC
Dick Bove: Change in management key at Goldman Sachs Tuesday, 18 Apr 2017 | 3:01 PM ET | 05:19U.S. equities fell on Tuesday after Goldman Sachs shocked Wall Street by missing estimates. Investors also remained vigilant amid U.S.-North Korea tensions and the nearing of the French presidential election.
"We always say the market moves on earnings and the expectation of earnings," said Jeff Carbone, managing partner of Cornerstone Financial Partners. "We're getting mixed results in the early part of the earnings season."
"Earnings were expected to be very good and now we're taking the 'very' part out of it," he said.
The Dow Jones industrial average closed about 110 points lower, with Goldman shaving off 73 points and Johnson & Johnson taking out 26 points.
"The market has been sideways recently and investors have been looking for a reason to sell off," said Tom Cassidy, chief investment officer at Univest Wealth Management Division.
The S&P 500 fell 0.3 percent with health care, energy and financials leading decliners. The Nasdaq composite declined around 0.1 percent.
Goldman Sachs reported weaker-than-expected first-quarter resultsacross the board, with trading revenue disappointing analysts.
"I'm a little surprised that they missed because the market did so well in the first quarter," said Bruce Bittles, chief investment strategist at Baird. The S&P 500 and the Dow Jones industrial average rose 5.53 percent and 4.56 percent last quarter, respectively.
Last quarter marked the first time since 2015 that Goldman's earnings per share missed analysts' expectations and the first time since the first quarter of last year that sales came below estimates.Mario Tama | Getty Images
Johnson & Johnson also reported mixed quarterly results which sent its shares dropping more than 3 percent. Video-streaming firm Netflix posted better-than-expected earnings, but its guidance fell short of estimates.
Bank of America, meanwhile, reported strong first-quarter results with almost every single metric meeting or topping analyst expectations.
The three major indexes snapped a three-day losing streak on Monday, with the Dow rising more than 180 points, albeit during the lightest trading volume day of the year following the Easter holiday.
"I think this market is trapped in a range and I still think there's some unfinished business to the downside," said Baird's Bittles.
Investors also remained cautious as U.S.-North Korea tensions lingered. Vice President Mike Pence reassured Japan of American commitment to reining in North Korea's nuclear and missile ambitions on Tuesday, after warning that U.S. strikes in Syria and Afghanistan showed the strength of its resolve.
Pence arrived in Tokyo from South Korea, where he assured leaders of an "iron-clad" alliance with the United States in the face of the reclusive North, which has conducted a series of missile and nuclear tests in defiance of U.N. sanctions.
U.S. Treasury prices rose, sending the benchmark 10-year note yield down to about 2.17 percent while the short-term two-year note yield slipped to 1.165 percent.
Investors also kept an eye on France, as campaigning ramped up ahead of the first round of the presidential election. Left-wing candidate Jean-Luc Melenchon's surge in polls added to investors' worries as it becomes unclear who will win the contest.
European equities fell broadly after UK Prime Minister Theresa May called for a snap election in June. The announcement also sent the British pound for a loop. The currency rose more than 2 percent to $1.284 after briefly falling more than 1 percent.
GBP/USD intraday
Source: FactSet
"No one was expecting this. Not least because the government itself ruled an election before 2020 out barely four weeks ago. But Theresa May has clearly smelt an opportunity to consolidate her mandate ahead of the Brexit negotiations," said Luke Bartholomew, investment manager at Aberdeen Asset Management.
In economic news, housing starts fell 6.8 percent last month, more than the expected 3.9 percent decline. Industrial production rose 0.5 percent last month, in line with expectations.SymbolNamePrice Change%ChangeDJIADow Industrials21633.14 80.050.37%S&P 500S&P 500 Index2457.74 9.910.40%NASDAQNASDAQ Composite6304.60 30.170.48%
The Dow Jones industrial average fell 113.64 points, or 0.55 percent, to close at 20,523.28, with Goldman Sachs leading decliners and Coca-Cola the top advancer.
The S&P 500 dropped 6.82 points, or 0.29 percent, to end at 2,342.19, with health care leading six sectors lower and consumer staples the biggest riser.
The Nasdaq pulled back 7.32 points, or 0.12 percent, to close at 5,849.47.
Decliners were a step ahead of advancers at the New York Stock Exchange, with an exchange volume of 762.43 million and a composite volume of 3.262 billion at the close.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded near 14.4.
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Jul 14, 2017 | Morningstar
Johnson & Johnson (JNJ) reported first-quarter results largely in line with our expectations, and we don’t expect any major changes to our $108 fair value estimate. We continue to view the stock as slightly overvalued as the growth prospects for the company’s divisions don’t appear strong enough to support the current market price. Further, we are concerned that the pending acquisition of Actelion is an overpayment, partly motivated by an effort to accelerate growth in the drug group. Despite valuation concerns, the company’s wide moat continues to look strong with innovation and brand power continuing to drive stable cash flows.About the AuthorDamien Conover, CFA, is director of healthcare equity research and equity strategy for Morningstar.Contact Author | Meet other investing specialists
Modest growth across the board led to the company’s largely flat operational growth of 1% year over year, excluding acquisition and divestitures. In the pharmaceutical group, price discounts, competitive pressures, and an unfavorable prior period adjustment weighed on sales. We expect increasing generic competition to lead to 3% average annual growth for the segment over the next three years. While we remain optimistic about cancer drugs Imbruvica and Darzalex, the increasing competition for the company’s leading drug Remicade from both branded and biosimilar drugs will create a tough headwind for growth. Additionally, while the Actelion drugs help boost top-line growth, we believe the deal came at too high of a price. Nevertheless, we expect the deal to close late in the second quarter, in line with management guidance. Outside of the drug group, the device and consumer divisions look poised to contribute similar long-term growth, resulting in overall company growth of close to 3% annually over the next three years. While the consumer group posted growth below this longer-term view in the quarter due partly to competitive pressures, we believe the brand power and entrenched products should return to a more normalized growth rate in the remainder of the year.
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Johnson & Johnson Sees Little Impact In Key Area Despite Pfizer Competition
Jul 14, 2017 | The Street
In the first quarter of 2017, Johnson & Johnson (JNJ) saw "very little impact" from biosimilar competition to Remicade in the U.S., said chief financial officer Dominic Caruso on an earnings call Tuesday.
Remicade is a treatment for arthritis, ulcerative colitis and Crohn's Disease and is a key component of Johnson & Johnson's immunology franchise, which also includes Stelara and Simponi.
Previously the company has said it expects a 10% to 15% market share erosion for Remicade, Tony Butler, an analyst with Guggenheim Securities, noted in an interview on Monday.
Remicade is a treatment for arthritis, ulcerative colitis and Crohn's Disease. Pfizer(PFE) launched Inflector, a biosimilar of Remicade, in November.
"Of course, it's early because the product just launched at the end of last year," Caruso said, referring to Inflectra, a Remicade biosimilar launched by Pfizer in November.
He noted that there's no interchangeability, "so we certainly don't expect that physicians will switch patients," adding: "They may start new patients on therapy. But with the long history that we have of Remicade's efficacy and safety, we believe patients will move slowly to switch to a biosimilar."
Remicade sales in the U.S. were $1.18 billion in the first quarter, down 2.4% year-over-year. Worldwide sales totaled $1.67 billion, down 6%.
Among the topics discussed during the conference call was potential tax reform.
Asked by an analyst for his thoughts on the prospects for corporate tax reform and repatriation, Caruso said he was in Washington last week and his takeaway was that "both the House and the Senate are waiting for guidance from the White House on whether they prefer the border adjustment tax or whether they have another vehicle that they would like to implement."
Also during the call, Caruso said Johnson & Johnson continues to evaluate options for its diabetes care business.
Back in January, when it reported fourth-quarter results, Johnson & Johnson said it was looking at potential strategic options for the diabetes care unit, including LifeScan, Animas and Calibra Medical.
On Tuesday, Johnson & Johnson reported first-quarter adjusted earnings per share of $1.83, up 5.8% year-over-year, and revenue of $17.8 billion, up 1.6% compared to the same period a year ago. Analysts polled by FactSet Research Systems had forecast adjusted EPS of $1.72 on revenue of $18.02 billion.
Pharmaceutical sales were $8.2 billion, up 0.8% year-over-year. Consumer sales were $ $3.2 billion, up 1%, and medical devices sales were $6.3 billion, representing a 3% rise from the year-ago period.
Also on Tuesday, Johnson & Johnson said its deal to acquire Swiss biotech Actelion Ltd. remains on pace to close in the second quarter. Johnson & Johnson in January said it will
purchase Actelion for $30 billion and plans to spin out the latter's research and development unit into a separate business.The company has now included the estimated impact of the Actelion acquisition in its financial guidance.
For full-year 2017, Johnson & Johnson raised its sales guidance to $75.4 billion to $76.1 billion and its adjusted earnings guidance to $7.00 to $7.15 a share. Previously, the company has forecast full-year 2017 sales of $74.1 billion to $74.8 billion and adjusted earnings of $6.93 to $7.08 per share.
Shares of Johnson & Johnson were trading at $121.34 on Tuesday, down 3.5%.
In February, Johnson & Johnson completed its purchase of Abbott Laboratories'(ABT) medical optics business in a $4.325 billion deal first announced in September.
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Johnson & Johnson: Help Me Actelion, You’re My Only Hope
Jul 14, 2017 | Barron's
Shares of Johnson & Johnson (JNJ) are on pace for their biggest drop since March 2009 after the health-care giant reported disappointing earnings.
Johnson & Johnson reported a profit of $1.83 a share, beating forecasts for $1.77, while sales of $17.77billion missed Street expectations for $18.02 billion. And while Johnson & Johnson raised its guidance for the year, the more optimistic outlook was due to its pending acquisition of Achtelion.
Cowen's Joshua Jennings contends that the "the need for Actelion [was] highlighted by [the] 1Q'17 slow down." He explains:We would highlight that the Pharma pipeline remains robust but more meaningful contribution will kick in beyond 2017. Historical growth drivers decelerated in 1Q and are likely to remain at a more moderate growth clip through the rest of the year making the Actelion acquisition more timely than we had previously thought as the new franchise will bolster growth in front of the pipeline support. On the margin front, the stellar 330bps 2016 OM expansion pace moderated as expected as JNJ experienced 10bps of margin expansion. The $0.06 beat was driven primarily by a lower than expected tax rate and share count in our model thus the EPS beat is unlikely to offset concerns surrounding the top line growth trajectory of the core JNJ franchises.
Shares of Johnson & Johnson have dropped 3.6% to $121.17 at 11:15 a.m. today.
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