Income · Stocks to Consider and Updates

Johnson & Johnson to Acquire Abbott Medical Optics

JNJ Johnson & Johnson (NYSE: JNJ – $118.40) announced a definitive agreement to acquire Abbott Medical Optics (AMO), a wholly-owned subsidiary of Abbott Laboratories, for $4.325 billion in cash. The purchase is expected to strengthen J&J’s global leadership in eye health, adding cataract and refractive eye surgery to the company’s Vision Care Portfolio. AMO reported sales of $1.1 billion for 2015. The acquisition will include ophthalmic products in three business segments: cataract surgery, laser refractive surgery and consumer eye health. The transaction, subject to customary conditions and approvals, is expected to close in the first quarter of 2017 and would be modestly accretive immediately to adjusted earnings per share. Following the expected closing, sales will be reported in the Medical Devices segment as a separate platform within Vision Care.

       While high quality shares of J&J are trading above their long-term median valuation, they can be held for further total returns out to late decade.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s