Johnson & Johnson stock jumped Wednesday after the Dow Jones health behemoth raised its 2025 guidance in the wake of a bullish second-quarter report.
For the year, J&J now expects adjusted earnings of $10.80 to $10.90 per share, up 15 cents at the midpoint from its previous guidance. The company also forecast $93.2 billion to $93.6 billion in sales, an increase of $2 billion. Both measures handily topped Wall Street's call.
But Leerink Partners analyst David Risinger kept his market perform rating on shares, noting there are numerous catalysts this year.
Johnson & Johnson continues to navigate lawsuits tied to its defunct talc business. Regulators will also make a decision about the patent life for drugs that contain an additive called hyaluronidase, which will impact J&J's Darzalex Faspro. And, the company is likely to soon have results for studies of experimental treatments for ulcerative colitis and Crohn's disease.
Johnson & Johnson stock surged 6.2%, closing at 164.78. Shares are consolidating with a buy point at 169.99, according to MarketSurge.
What J&J's Medtech Report Says
Overall, sales came in at $23.74 billion in the second quarter, growing 5.8% and beating forecasts for $22.85 billion, according to FactSet. Adjusted earnings fell 2.1% vs. the year-earlier quarter, but topped the Street's call for $2.68 a share.
Risinger noted sales of Stelara, which treats autoimmune conditions, missed expectations by 8% at $1.7 billion. But revenue from cancer blockbuster Darzalex topped forecasts by 4% at $3.5 billion.
Total medtech revenue also beat, bringing in $8.5 billion. Evercore ISI analyst Vijay Kumar noted orthopedic revenue came in short, but the overarching beat "should be positive for medtech" on a broad basis. For J&J, hip and knee sales decelerated due to competitive pressures. That should bode well for Stryker and Medtronic, he said in a report.
J&J also reported growth in its electrophysiology business. Electrophysiology devices focus on the electrical activity of the heart. In this space, "overall trends seem positive and should bode well for BSX & MDT," Kumar said, referencing Boston Scientific and Medtronic.
Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.
