Johnson & Johnson Earns $1.25 Per Share

Good news for Johnson & Johnson ($JNJ). The company reported third-quarter earnings of $1.25 per share which was four cents more than expectations. JNJ also raised full-year guidance from a range of $5.00 to $5.07 per share, to a new range of $5.05 to $5.10 per share.

Sales of recently approved drugs, including Zytiga for prostate cancer, Xarelto for stroke prevention and Stelara for psoriasis helped push revenue 6.5 percent to $17.1 billion for the quarter, from $16 billion a year earlier. The June purchase of Synthes Inc. with novel financing that used cash that had accumulated outside the U.S. also bolstered the company’s quarterly earnings.

“We continue to see improving fundamentals at J&J across all of its segments,” Derrick Sung, an analyst at Sanford C. Bernstein & Co. in New York, said in an Oct. 12 note to investors. “In pharma, J&J will start seeing contributions this year” from products that could generate nearly $7 billion annually by 2015, he said. “J&J’s competitive position and growth prospects are now strengthened by the closing of the Synthes acquisition.”

For the first nine months of this year, JNJ has earned $3.91 per share. That means they see Q4 coming in between $1.14 and $1.19 per share. The stock has a very good shot of making a new 52-week high today, and then making a run at the all-time high set four years ago.

In July, JNJ lowered their full-year guidance from $5.07 to $5.17 per share to $5.00 to $5.07 per share. So they’re taking back a good deal of that lowering.

The Street currently expects JNJ to earn $5.47 per share for 2013. With today’s earnings report, I think that will be bumped up a few pennies. JNJ remains a very good buy.

Posted by on October 16th, 2012 at 9:43 am


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