Johnson and Johnson Q4 results: shares down 2% despite earnings revenue beating estimates

Johnson and Johnson reports a profit in its Q4 earnings report.

Johnson and Johnson after Q4 earnings Source: Bloomberg

Johnson and Johnson stock is down despite a positive Q4 earnings report. Johnson and Johnson revenue easily beat Wall Street estimates despite controversy about reports of asbestos in its products.

Johnson and Johnson earnings: key figures

Earnings per share (EPS) $1.97
Revenue $20.39 billion
Net income $3.04 billion
Net sales $20.4 billion
Pharmaceutical sales $10.19 billion

Johnson and Johnson earnings

Johnson and Johnson earnings beat fit the estimates of financial experts. The corporation’s earnings per share (EPS) was $1.97, more than the expected $1.95. Johnson and Johnson revenue was $20.4 billion, exceeding the predicted $20.2 billion.

Johnson and Johnson revenue grew because of increased sales in its pharmaceutical sales division. Purchases of the prostate cancer drug Zytiga brought in $786 million to propel Johnson and Johnson earnings up. Psoriasis treatment medication Stelara also drove up Johnson and Johnson results with sales of $1.44 billion.

The only dip in sales came from its medical device division. Johnson and Johnson revenue in medical devices was $6.67 billion, less than the $6.68 billion that Wall Street expected. Purchases of its most famous products, baby care products, fell to $473 million. The sales slump is likely because of the controversy in 2018 when reports surfaced of the company knowing for years about having asbestos in its talc powder. The corporation denies the allegations that women contracted ovarian cancer from using the powder.

‘Johnson and Johnson's baby powder is safe and asbestos-free. Studies of more than 100,000 men and women show that talc does not cause cancer or asbestos-related disease. Thousands of independent tests by regulators and the world's leading labs prove our baby powder has never contained asbestos,’ said the company in a statement.

‘We remain committed to ensuring that facts about talc are understood and we will continue to defend the safety of our products,’added chief executive officer (CEO), Alex Gorsky.

What do Johnson and Johnson results mean for their share price?

Even though Johnson and Johnson Q4 results were profitable, the ensuing controversy about thesafety of its baby products will always be a factor for Johnson and Johnson share price. Johnson and Johnson share price is currently dropping because of uncertainty about the global economy.

How do Johnson and Johnson results compare to other healthcare stocks?

Johnson and Johnson share price is currently at $ 128, much higher than other healthcare stocks like Pfizer’s $42 and Merck’s $75. While Johnson and Johnson’s share price is up, the shares are currently falling more than other healthcare stocks. The positive Johnson and Johnson earnings report could bode well for other healthcare companies when they make their earnings reports.

What is the Johnson and Johnson dividend forecast?

Gorsky noted that the Johnson and Johnson profits increased, he is not being complacent.

‘As you've heard me say before, while we're pleased with our 2018 performance it's important to remember that we are never satisfied. Looking ahead, the strength of our broad-based business and disciplined approach to portfolio management positions us to continue to fuel investments in innovation that enable us to capitalize on strategic opportunities and deliver strong performance over the long-term,’ said Gorsky.

Johnson and Johnson’s dividend forecast for its earnings per share is between $8.50 and $8.65 for future 2019 earnings reports. The company’s revenue prediction is also in the range of $80.4 billion to $81.2 billion for future earnings reports.

Despite the controversy the corporation is facing, the latest Johnson and Johnson earnings report is proof that customers will continue to purchase its many pharmaceutical and personal care products.

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