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Johnson & Johnson (JNJ) Laps the Stock Market: Here's Why

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Johnson & Johnson (JNJ - Free Report) closed the latest trading day at $157.89, indicating a +1.87% change from the previous session's end. This move outpaced the S&P 500's daily gain of 0.24%. At the same time, the Dow added 0.16%, and the tech-heavy Nasdaq gained 0.08%.

Shares of the world's biggest maker of health care products witnessed a gain of 4.62% over the previous month, beating the performance of the Medical sector with its gain of 3.63% and the S&P 500's gain of 2.37%.

Market participants will be closely following the financial results of Johnson & Johnson in its upcoming release. The company is predicted to post an EPS of $2.59, indicating a 4.43% decline compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $21.66 billion, up 1.29% from the year-ago period.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $10.58 per share and a revenue of $90.03 billion, signifying shifts of +6.01% and +1.36%, respectively, from the last year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Johnson & Johnson. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1% higher. At present, Johnson & Johnson boasts a Zacks Rank of #3 (Hold).

Digging into valuation, Johnson & Johnson currently has a Forward P/E ratio of 14.65. This signifies a premium in comparison to the average Forward P/E of 12.51 for its industry.

It's also important to note that JNJ currently trades at a PEG ratio of 2.49. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Large Cap Pharmaceuticals industry held an average PEG ratio of 1.35.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry, currently bearing a Zacks Industry Rank of 174, finds itself in the bottom 31% echelons of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow JNJ in the coming trading sessions, be sure to utilize Zacks.com.


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