Johnson & Johnson Narrows 2024 Outlook, Raises Dividend

Image Source: J&J

By Brian Nelson, CFA

Johnson & Johnson (JNJ) reported mixed first-quarter 2024 results on April 16 with adjusted operational growth of 4%. Excluding its COVID-19 vaccine sales, revenue growth was 7.7% in the period. First quarter adjusted earnings per share advanced 12.4%, to $2.71, which was slightly better than the consensus forecast. Management was upbeat in the press release:

Johnson & Johnson’s solid first quarter performance reflects our sharpened focus and the progress in our portfolio and pipeline. Our impact across the full spectrum of healthcare is unique in our industry, and the milestones achieved this quarter reinforce our position as an innovation powerhouse.

J&J’s adjusted operational sales for its Innovative Medicine division increased 2.5%, while adjusted operational sales increased 6.5% in its MedTech division. Excluding COVID-19 related revenue, its Innovative Medicine division experienced sales growth of 8.3%. Management pointed to growth in DARZALEX, ERLEADA, CARVYKTI, TECVAYLI, UPTRAVI, OPSUMIT, TREMFYA, and SPRAVATO. The company also noted that electrophysiology products and Abiomed (cardiovascular) helped drive MedTech sales higher.

Image Source: J&J

Looking to 2024, J&J expects adjusted operational sales growth in the range of 5.5%-6%, the midpoint of which is up from the prior range of 5%-6%. Adjusted operational diluted earnings per share is targeted in the range of $10.60-$10.75 per share, the midpoint also up from the range of $10.55-$10.75 previously. Management also upped its dividend 4.2%, to a quarterly payout of $1.24 per share, implying a forward estimated dividend yield of 3.4%. We like J&J, but we won’t be adding it back to any newsletter portfolio anytime soon.