Tag Archives: jnj

Intuitive Surgical Beats Q1 Estimates As Stock Hovers Near High

Robotic-surgery specialist Intuitive Surgical ( ISRG ) beat Wall Street’s Q1 earnings estimates late Tuesday, but the stock was down 1% in after-hours trading. Intuitive Surgical’s earnings totaled $4.42 a share, up 24% from the year-earlier quarter and topping analysts’ consensus of $4.33 a share, according to Thomson Reuters. Sales gained 12% to $595 million, vs. analysts’ $593 million. Intuitive Surgical is one of the highest-rated stocks in the Medical Systems group, which is collectively doing well at No. 24 on IBD’s ranking of 197 industry groups. Shares hit a lifetime high of 630.67 last Wednesday, and have hovered within 1% of that mark since then. The stock closed down a fraction in regular trade on the stock market today , at 623.71. Intuitive Surgical is the second of three hot medical stocks reporting earnings this week. Earlier Tuesday, Johnson & Johnson ( JNJ ) hit a new high of 113.95 after it beat Q1 estimates and raised its full-year guidance due to diminishing foreign-exchange headwinds. Stryker ( SYK ), which also hit a new high of 110.98 early Tuesday but gave back its gains later, is due to report earnings Wednesday after the close.

J&J Earnings Beat Estimates; Guidance Raised As FX Headwinds Ease

Medical giant Johnson & Johnson ( JNJ ) beat Q1 estimates and raised guidance Tuesday morning, sending its stock to its fifth recent record high. J&J reported earnings of $1.68 a share, up 8% from the year-earlier quarter and beating analysts’ consensus by 3 cents, according to Thomson Reuters. Sales rose 0.6% to $17.48 billion, matching consensus. J&J said that the foreign-exchange impact knocked 6.6 percentage points off sales growth. Nonetheless, the forex headwinds finally seem to be abating. J&J cited the improved forex outlook as the reason it was raising full-year sales guidance by $400 million, to $71.2 billion to $71.9 billion. It also added 10 cents to EPS guidance, now $6.53 to $6.68. IBD’s Take: Johnson & Johnson rated No. 1 in its group, but CR is iffy . “Our Pharmaceuticals business continues to deliver impressive levels of growth, we have steady improvement in our Consumer business, and we are seeing momentum in our Medical Devices businesses, all of which are fueling our optimism for the full-year ahead,” J&J CEO Alex Gorsky said in a statement. J&J stock was up 2% in early trading on the stock market today , touching a record high of 113.60 intraday. The stock is up more than 10% for the year so far, and it is the first of three medical stocks that are hitting new highs  and are reporting this week, the others being Intuitive Surgical ( ISRG ) this evening and Stryker ( SYK ) late Wednesday. “This morning, J&J continued the growth momentum the company has seen in recent quarters, again delivering organic sales growth acceleration and its second consecutive quarter of double-digit EPS growth on an adjusted, operational basis,” wrote Leerink analyst Danielle Antalffy in a research note. She noted that, excluding the impact of foreign exchange, M&A activity and shrinking sales of hepatitis C drug Olysio — which was made obsolete when Gilead Sciences ( GILD ) released Harvoni in late 2014 — sales rose 6.9%. Operating EPS growth was just above 10%. Credit Suisse analyst Vamil Divan wrote that the pharma sales beat was driven by the immunology franchise — Remicade, Simponi and Stelara — as well as its stroke prevention treatment Xarelto. But another top seller, diabetes drug Invokana, missed consensus by 19%. Investors had been wondering if Invokana would take a hit from Eli Lilly ‘s ( LLY ) Jardiance, which last September proved that it could dramatically cut deaths from heart failure but didn’t get a sales bump from this in Q4.

AbbVie Bolsters Immunology Business, Acquires Boehringer Drug

Big pharma AbbVie ( ABBV ) said Monday that it was acquiring rights to two immunology drugs developed by German counterpart Boehringer Ingelheim, but its stock was flat as Goldman Sachs warned of increasing competition. AbbVie agreed to pay $595 million upfront plus undisclosed milestone payments and royalties for the right to commercialize BI 655066, a drug in late-stage testing for psoriasis, and in earlier testing for Crohn’s disease, psoriatic arthritis and asthma. A phase-two trial comparing BI 655066 head to head with Johnson & Johnson ’s ( JNJ ) Remicade found that after nine months of treatment, 69% of patients on Boehringer’s drug had clear or almost clear skin, compared with 30% in the Remicade arm. AbbVie also acquired rights to BI 655064, an earlier-stage drug that attacks the CD40 protein, which may be connected to lupus nephritis, Crohn’s disease and ulcerative colitis. AbbVie said in its press release that it will decide whether to go forward with that drug “after completion of certain undisclosed clinical achievements.” AbbVie said that its success in developing and commercializing Humira, currently the world’s top-selling immunology drug, gives it the expertise to do the same with Boehringer’s products. Humira is nearing the end of its patent life, leading to much speculation on Wall Street about when biosimilar competitors might launch and how much of an impact they might have. Goldman Sachs analyst Salveen Richter took a pessimistic view of the matter Monday, saying that the current political focus on lowering drug prices will probably encourage cheap Humira knock-offs. “We are not changing our 2016-2020 AbbVie forecasts and continue to believe that Humira will remain a durable asset free of U.S. biosimilars, at least until the end of the decade,” Richter wrote as he removed AbbVie stock from his Conviction Buy list and cut his price target to 68 from 80.  “However, we adjust our terminal value growth rate (from +1% to 0%) and model a faster decline curve post introduction of Humira biosimilars in the U.S. after 2020 through 2025.” AbbVie stock fell as much as 2.4% in early trading on the stock market today , but by midday it was flat, near 56. Meanwhile, Richter put BioMarin Pharmaceuticals ( BMRN ) on his Conviction Buy list in AbbVie’s place, setting his price target at 129. BioMarin, Richter noted, has guided that it will go into the black next year even without a contribution of its recently FDA-rejected muscular-dystrophy drug Kyndrisa, “showing opex restraint and a commitment to profitability.” He added that several data releases this year could bring upside for medications including BioMarin’s gene therapy for hemophilia and treatments for the rare diseases achondroplasia and phenylketonuria. BioMarin stock was up 2.5% midday Monday, near 89. Image provided by Shutterstock .