Johnson & Johnson Prepares for Q3 Earnings, Amid Mixed Signals

Financial Forecast and Recent Developments Take Center Stage

Johnson & Johnson JNJ is set to release its third-quarter earnings on October 15, before the market opens. Analysts predict the healthcare giant will report earnings per share (EPS) of $2.21 alongside revenues of $22.16 billion.

However, recent news regarding its MedTech acquisitions and halting drug trials has drawn significant attention away from its financial outlook.

MedTech Expansion and Drug Trial Setbacks

Johnson & Johnson recently finalized its acquisition of V-Wave, which adds a new minimally invasive treatment for cardiovascular issues to its MedTech lineup. The Ventura Interatrial Shunt is anticipated to enhance J&J’s efforts in addressing heart failure. Nevertheless, the company has cautioned that this acquisition will negatively impact adjusted EPS by approximately 24 cents in 2024 and 6 cents in 2025—a topic likely to be discussed in the upcoming earnings report.

Conversely, the company faced a setback with its Phase 3 SunRISe-2 trial, which aimed to test a treatment for muscle-invasive bladder cancer. The trial was terminated early due to lack of evidence showing it worked better than existing chemoradiation therapies. Despite this, J&J remains hopeful about its TARIS platform, projecting a potential market worth $5 billion.

Stock Performance Sends Mixed Signals

Even with some positive advancements in MedTech, Johnson & Johnson’s stock performance has been relatively flat this year, gaining only 0.93% year-to-date and 2.49% over the past year. In recent months, however, the stock has risen by 9.40%, indicating a slow but steady improvement.

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Currently priced at $161.46, JNJ stock is just above its eight-day simple moving average of $160.48, a positive indicator. However, it is trailing behind its 20-day and 50-day moving averages, which are $162.32 and $162.53, respectively. This pattern suggests underlying selling pressure could linger in the near term.

Read Also: What Analysts Are Saying About Johnson & Johnson Stock

Chart created using Benzinga Pro

The Moving Average Convergence/Divergence (MACD) indicator is currently at -0.72, suggesting a bearish trend. On the other hand, JNJ’s Relative Strength Index (RSI) stands at 47.83, indicating a neutral market position.

Bollinger Bands highlight a range between $157.98 and $168.05. JNJ stock is positioned toward the lower bearish band, suggesting potential for a rebound, although caution is advised given the existing selling pressure.

Will Q3 Earnings Shift the Momentum?

As Johnson & Johnson prepares for its third-quarter earnings report, all eyes will be on how the company updates its guidance following the V-Wave acquisition and the performance of its MedTech and Innovative Medicine divisions.

Despite the stock’s recent challenges, strategic moves in MedTech and future product developments could unlock new growth opportunities. Investors will be eager to see if the upcoming earnings report can pave the way for improved market confidence.

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