Will Johnson & Johnson (JNJ) Earnings Move the Dow?

With dozens of companies having already reported quarterly results, we’re now in the heart of earnings season. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed, knee-jerk decision.

Johnson & Johnson (NYSE:JNJ)Let’s turn to Johnson & Johnson (NYSE:JNJ). With its 11% gain outpacing the Dow Jones Industrials in 2012, the health care conglomerate hopes that 2013 will mark a new chapter in which it can get past some of the challenges of recent years. Let’s take an early look at what’s been happening with Johnson & Johnson over the past quarter and what we’re likely to see in its quarterly report next Tuesday morning.

Stats on Johnson & Johnson

Analyst EPS Estimate $1.17
Change From Year-Ago EPS 3.5%
Revenue Estimate $17.67 billion
Change From Year-Ago Revenue 8.7%
Earnings Beats in Past 4 Quarters 4

Source: Yahoo Finance.

Will Johnson & Johnson move the markets?
Projections for J&J’s fourth-quarter earnings have stayed quite stable over the past few months, with the consensus earnings-per-share forecast barely budging. That resilience has contributed to strong stock performance, with shares rising about 5% since mid-October.

The big challenge that J&J has faced throughout the past several years has been a surge in product recalls and other negative news. With an average of almost one recall per month in 2012, J&J failed to make much progress on that score last year, and the repeated failures have damaged consumer confidence in the company’s products. One thing to look for in this quarter’s report is any sign that problems are creeping up among J&J’s more consumer-facing segments.

But J&J may be able to gain from the woes of robotic surgical giants MAKO Surgical and Intuitive Surgical, both of which have come under fire as growth in the industry starts to slow. If robotic medical devices become more of a niche market and less a cutting-edge technology, then J&J’s more traditional device business may be better able to take advantage.

One question J&J management might get to address this quarter is whether J&J would be better off splitting up. With fellow health-care conglomerate Abbott Laboratories (NYSE:ABT) having spun off its AbbVie proprietary pharmaceutical business into a separately traded entity, some would argue that J&J could benefit from having its pharmaceuticals, medical-device, and consumer products divisions all set free to operate independently.

J&J has every chance to put its best foot forward to start 2013. If it can’t reverse some of its more troubling trends, though, 2013 could be another tough year for the health-care giant.

The article Will Johnson & Johnson Earnings Move the Dow? originally appeared on Fool.com.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Intuitive Surgical, Johnson & Johnson, and MAKO Surgical. The Motley Fool owns shares of Intuitive Surgical, Johnson & Johnson, and MAKO Surgical.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Best States To Practice Medicine

The 10 Best States to Have a Business

The 12 Most Expensive Apple (AAPL) Apps in the Market

The 10 Richest Billionaires in the World

10 Biggest Kickstarter Failures

The 10 Best Places to Work At

The Top 10 of Google Inc (GOOGL)’s Most Expensive Acquisitions

13 Best Cities to Visit in South America

10 Most Expensive Works of Art of All Time

The 10 Richest Banks in the World

The 10 Best-Paying Jobs in America (2014)

7 Most Expensive Foods in the World

The World’s Top 10 Earning Authors

Five Wicked and Very Expensive Items (and Other “Stuff”) Sold on eBay

10 Biggest Celebrity Bankruptcies

The Top 10 Highest Paid CEOs in 2014

The 10 Most Expensive Real Estate Cities in America

10 Most Expensive States To Live In America

The 10 Best Airlines in the World

The 10 Best-Selling Cars in 2014

The 10 Best Industries to Invest In

The 10 Most Expensive States to Own a Car In

Top 10 Business Schools in US: 2014 Rankings

Top 20 Female Billionaires in 2014

6 Movies That You Should Watch to Better Understand The Cold War

Top 15 Best Paying Jobs for Women in 2014

Top 6 Things Rich People Do Differently Every Day

5 Retirement Mistakes To Avoid (and Einstein’s Famous Quote)

11 Smartest People in the World

6 Films About the Financial World You Need To Watch (While “The Wolf” is Not Around)

Warren Buffett and Billionaires Are Crazy About These 7 Stocks

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top 6 Tax Scams and How to Protect Yourself

Top Businesses to Invest In

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!