Income · Stocks to Consider and Updates

Johnson & Johnson Posts Strong Results; Improves Guidance

Excluding non-recurring items, healthcare giant Johnson & Johnson (NYSE: JNJ $144.64) reported earnings per share of $1.74, above the consensus of $1.72 and last year’s $1.58. Adjusted 2017 full-year earnings settled at $7.30/share, an Increase of 8.5%. Revenue rose 11.5% in the quarter to $20.20 billion, beating the analysts’ estimates of $20.08 billion. The struggling consumer segment revenue rose 3.1% to $3.54 with gains in the Neutrogena and Tylenol brands. Pharmaceutical revenue grew 17.6% to $9.68 billion to top expectations of $9.66 billion thanks to new products DARZALEX, which is used for patients suffering with multiple myeloma, and IMBRUVICA, a therapy approved for lymph node cancer. Additional contributors were STELARA (inflammatory diseases), XALETO, (an anticoagulant), and ZYTIGA (prostate cancer). The medical devices segment revenue increased 8.3% to $6.97 billion, also beating expectations of $6.90 billion. Geographically, total U.S. sales for the period were up 9.8% followed by strong showings in Europe and the Asia-Pacific regions, with gains of 18.2% and 12.1%, respectively.

       The company announced its 2018 full-year guidance for sales of $80.6 billion to $81.4 billion reflecting expected operational growth in the range of 3.5% to 4.5%. The Company also announced adjusted earnings guidance for full-year 2018 of $8.00 to $8.20 per share with expected operational growth in the range of 6.8% to 9.6%. The shares, yielding 2.3%, can continue to be held in a well-diversified income account for further positive total returns.

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