Please ensure Javascript is enabled for purposes of website accessibility

Johnson & Johnson's Fourth-Quarter Results Leave Wall Street With Mixed Emotions

By Cory Renauer - Jan 22, 2020 at 1:03PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The world's largest healthcare company gave investors reasons for both enthusiasm and concern.

Johnson & Johnson (JNJ 1.75%) kicked off another earnings season with fourth-quarter results that missed analysts' consensus estimates on the top line, but contained enough positive surprises to keep the stock from plunging.

The world's largest healthcare company reported revenue of $20.75 billion, which was $80 million less than the average Wall Street estimate. The bottom line was a different story: Adjusted earnings of $1.88 per share surpassed expectations by one penny.

Shopping cart filled with pills.

Image source: Getty Images.

On the way down

Questions about how much asbestos makes it into talcum powder continued to pressure Johnson & Johnson's consumer goods segment. Sales of its baby care products fell 11% from the prior-year period to $421 million.

The company's pharmaceutical segment is still responsible for a slight majority of total revenue despite declining sales of Remicade. Biosimilar competition for the aging anti-inflammatory injection pushed fourth-quarter sales down by 16.4% year over year to $1.0 billion.

Similarly, J&J's blockbuster prostate cancer treatment, Zytiga has been facing generic competition since late 2018 that pushed its fourth-quarter sales 13.8% lower to $677 million.

Going up

J&J was able to report total fourth-quarter revenue that rose 1.7% because a handful of newer products have compensated for the declines of Zytiga and Remicade.

Sales of Stelara -- a treatment for psoriasis, Crohn's disease, and ulcerative colitis -- surged 17.7% year over year to $1.7 billion. Sales of the company's more recently launched psoriasis injection, Tremfya, rocketed 53.9% higher to $270 million.

Younger drug launches in J&J's oncology segment also stepped up their performance in the fourth quarter. Combined sales of blood cancer treatments Darzalex and Imbruvica rose 32.5% to $1.7 billion.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Johnson & Johnson Stock Quote
Johnson & Johnson
$176.98 (1.75%) $3.04

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/20/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.