The company’s stock rose about 1.4 percent US$112.50 in premarket trading, on track to open at a record high.
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Earnings in the first quarter fell to $4.29 billion, or $1.54 a share, from $4.32 billion, or $1.53 a share, in the same period a year ago. Overall, though, sales were constrained by the strong dollar and Venezuela’s currency devaluation.
Nonetheless, the forex headwinds finally seem to be abating.
Johnson & Johnson expects full-year earnings in the range of $6.53 to $6.68 per share, with revenue in the range of $71.2 billion to $71.9 billion.
Revenue of almost $17.5 billion rose 0.6 percent from the first quarter 2015.
The maker of baby shampoo, prescription medicines and medical devices reported adjusted profit, which excludes amortization costs and restructuring costs, of $1.68 per share.
Johnson & Johnson beat quarterly earnings forecasts and slightly boosted its 2016 outlook, citing strong prescription drug revenue and a weakening dollar that will help improve sales in overseas markets. The company’s medical devices segment posted sales of $6.1 billion, showing a decrease of 2.4% YoY. Last year, it launched Darzalex, a potential blockbuster that’s the first antibody-based drug for the blood cancer multiple myeloma.
Total pharmaceutical sales of J&J for 1Q came in at $8.2 billion, an increase of 5.9% YoY. J&J had to gut and rebuild its main US factory for those, and it’s still under extra scrutiny by the Food and Drug Administration.
That once-lucrative drug is being crushed by newer rivals such as Gilead Sciences Inc.’s Harvoni, which is raking in billions every quarter.
The consensus estimate called for full-year EPS of $6.54 on revenue of $71.55 billion. Mr. Caruso indicated the company would look to deploy the capital toward acquisitions, but said J&J was willing to wait for “the right deal at the right time with the right party at the right valuation”.
Meanwhile, Erik Gordon, an analyst and business professor at University of MI, warned, “Nobody knows how huge the company’s liabilities could be in the talcum powder and other mass tort product liability cases”.
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Additional contributors to operational sales growth include REMICADE (infliximab) and SIMPONI/SIMPONI ARIA (golimumab), biologics approved for the treatment of a number of immune-mediated inflammatory diseases; STELARA (ustekinumab), a biologic approved for the treatment of moderate to severe plaque psoriasis and psoriatic arthritis; and INVEGA SUSTENNA/XEPLION/TRINZA (paliperidone palmitate), long-acting, injectable atypical antipsychotics for the treatment of schizophrenia in adults.
