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Why Johnson & Johnson Stock Rose Today

The Motley Fool
The Motley Fool
 2022-01-25

What happened

Shares of Johnson & Johnson (NYSE: JNJ) had risen 2.9% as of the market close on Tuesday. The gain came after the healthcare giant reported its 2021 fourth-quarter and full-year results before the market opened.

Johnson & Johnson announced fourth-quarter sales of $24.8 billion. This result reflected a 10.4% year-over-year increase but came in below the consensus Wall Street revenue estimate of $25.3 billion.

The company posted earnings per share of $1.77 based on generally accepted accounting principles ( GAAP ). Adjusted earnings per share in Q4 were $2.13, a 14.5% year-over-year jump and slightly better than the average analyst estimate of $2.12.

Investors were most encouraged, though, by J&J's 2022 outlook. The company expects operational sales of between $98.9 billion and $100.4 billion. It projects full-year 2022 adjusted earnings per share of $10.40 to $10.60. Both revenue and earnings ranges are above the consensus estimates.

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Image source: Getty Images.

So what

Stocks that exceed analysts' expectations tend to move higher, as Johnson & Johnson did today. What's more important is that the company continues to move in the right direction. J&J anticipates revenue growth of between 5.5% and 7% in 2022. That's not bad for a company as big as Johnson & Johnson.

Much of J&J's growth will likely come from products other than its COVID-19 vaccine. Excluding those vaccine sales, the company looks for revenue to increase between 5% and 6% this year.

Now what

The COVID-19 pandemic will likely continue to rank as the biggest factor impacting Johnson & Johnson for now. Assuming there is no significant disruption to physicians and hospitals going forward, J&J should be able to keep its momentum going.

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Keith Speights has no position in any of the stocks mentioned. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy .

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