Johnson & Johnson’s Share Forecast February 2022 – Time to Buy JNJ?
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Shares of American multinational corporation Johnson & Johnson’s (NYSE: JNJ) are in the red today, after closing at $172.76 as of February 3rd (19:54 EST). JNJ Shares didn’t show big movement after the company posted a solid quarterly report. Sales increased by 10% and earnings increased by 173%. Which have attracted the attention of investors.
Johnson & Johnson’s – Technical Analysis
According to the financial statement released by Johnson & Johnson’s, the market cap of the company is $454.80 billion with total assets worth $174.89 billion. Revenue for 2021was at $93.78 billion with a profit margin of 22.26% compared to $82.57 billion in 2020.
Moving averages such as Exponential Moving Average (10)(170.62), Simple Moving Average (10)(169.49), Exponential Moving Average (20)(169.77), Simple Moving Average (20)(169.51) and Exponential Moving Average (30)(169.19) are indicating a buy action. Oscillators such as Relative Strength Index (14)(60.19), Stochastic %K (14, 3, 3)(93.60), Commodity Channel Index (20)(82.75), Average Directional Index (14)(13.16) and Awesome Oscillator(1.81) are neutral.
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Recent Developments
Johnson & Johnson’s is separating its consumer health business very soon, which will mean a loss in revenue for the core company. This segment didn’t perform well in the final three months of 2021, generating sales of $3.7 billion and marginal growth at a rate of 1.1% from the prior-year period. This is why separating consumer health into a separate entity could be a good move for Johnson & Johnson’s. Comapred to other segments such as revenue from medical devices (which grew 4.1%) and pharmaceutical sales which grew 16.5%.
The company’s top line got a boost from COVID-19 vaccine revenue in Q4. While the pharma business increased $12.3 billion a year ago to $14.3 billion in the most recent quarter, the main difference-maker was the vaccines. Without it, revenue from pharma would be at $12.7 billion, equating to a growth of 3.3%. Within this sector, the company’s oncology revenue rose 10% and neuroscience drug sales increased by 5.5%. But if we do not consider the vaccine sales, the overall 16.5% growth rate for pharmaceuticals is misleading.
Johnson & Johnson’s achieved net earnings of $4.7 billion for Q4. This is more than double the $1.7 billion it achieved last year. The company incurred other expenses of $9 million which totalled more than $2.3 billion a year earlier. Expenses a year earlier included acquisitions, restructuring and $5.1 billion in litigation expenses.
Should You Buy JNJ Shares?
One of the biggest reasons to invest in JNJ shares is the nature of the company. People will continue to get sick and require prescription drugs, medical devices, and healthcare services/products, no matter how bad the economy is. This allows the company to accurately forecast its sales, cash flow, and profit growth well in advance.
Johnson & Johnson’s delivered a solid quarter with good revenue growth. The net result is positive even though the numbers are skewed due to COVID-19 vaccine sales and comparable-year numbers. Management expects operational sales to rise by as much as 8.5% in 2022. This includes revenue from the vaccine and up to 7.5% growth without it.
While JNJ shares are not that eye-catching, they can prove to be a safe investment to hold in 2022. JNJ shares are growing at a decent rate, paying an attractive 2.5% dividend yield. This is better than the S&P 500’s 1.3%. Johnson & Johnson’s can be a profitable healthcare stock worth adding to portfolios for both conservative and long-term investors.
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