Prescription drugs boost drives J&J forecasts higher, shares rise
Reuters
Published Oct 15, 2019 08:25AM ET
Prescription drugs boost drives J&J forecasts higher, shares rise
(Reuters) - Johnson & Johnson (N:JNJ) boosted its profit forecast for the year on Tuesday after posting better-than-expected quarterly earnings on stronger prescription sales of its psoriasis treatment Stelara and cancer drug Imbruvica.
Shares of the company, which makes products ranging from prescription drugs to consumer goods such as Band-Aids, rose 2% to $133.48 in premarket trading.
J&J shares have been under pressure this year, widely underperforming the S&P healthcare sector (SPXHC), as the company faces more than 13,000 lawsuits tied to antipsychotic drug Risperdal as well as a range of lawsuits involving its baby powder, opioids, medical devices and other products.
J&J did not report litigation expenses for the third quarter and its legal costs over the nine-month period remained at $832 million, as was reported at the end of the second quarter.
JP Morgan analyst Chris Schott said litigation risk remains a clear overhang on the shares, but added that the results will likely be well received and continue to believe that analysts' estimates remain too low.
J&J's pharmaceuticals business has in recent years cushioned the impact of relatively slow growth in its other medical device and consumer units even as some of the company's older drugs face competition from cheaper versions.
Much of the growth has come from newer treatments such as Stelara, which reported a near 30% growth in sales to about $1.7 billion. Sales from cancer treatment Imbruvica rose about 31% to $921 million in the quarter.
The company on Tuesday said it now expects full-year adjusted earnings per share in the range $8.62 to $8.67, from its prior forecast of $8.53 to $8.63. Analysts were expecting $8.60 per share.
Net earnings rose to $4.83 billion, or $1.81 per share, in the quarter, from $3.93 billion, or $1.44 per share, a year earlier.
Excluding items, the company earned $2.12 per share, beating analysts' expectations of $2.01 per share, according to IBES data from Refinitiv.
Total sales rose 1.9% to $20.73 billion, above the average analysts' estimate of $20.07 billion.
Pharmaceutical unit sales rose 5.1% to $10.88 billion, above analysts estimates of $10.28 billion, according to a Refinitiv poll of three analysts.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.