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Investing.com - Goldman Sachs has raised its price target on Johnson & Johnson (NYSE:JNJ) to $212.00 from $186.00 while maintaining a Conviction Buy rating, citing impressive execution in the company’s Innovative Medicines segment.
The firm expects JNJ to beat consensus estimates for key products including Tremfya, Darzalyx, and Carvykti when the company reports third-quarter earnings on October 14. Goldman Sachs noted that JNJ’s year-to-date stock performance has significantly outpaced both the S&P 500 and large-cap pharmaceutical peers.
Goldman Sachs increased its valuation multiple to 17.0x from 15.5x, reflecting "increasing conviction in the commercial momentum behind the pharma franchise, emerging product cycles and pipeline growth opportunities." The firm also views JNJ as well-positioned regarding potential Medicare drug pricing negotiations.
In the MedTech division, Goldman Sachs expects stable growth despite competitive pressures, with industry research suggesting elevated U.S. procedure volume trends continuing through the third quarter.
The firm acknowledged recent talc litigation news, noting that JNJ plans to appeal a $966 million jury verdict, which the company believes is unconstitutional, and stated the verdict has no impact on its existing legal reserves. InvestingPro analysis reveals 12 additional key insights about JNJ’s financial health and market position, available exclusively to subscribers through the comprehensive Pro Research Report.
In other recent news, Johnson & Johnson has been ordered by a Los Angeles jury to pay $966 million in a lawsuit alleging that its baby powder products caused cancer, specifically mesothelioma, in a deceased woman. In the pharmaceutical arena, Johnson & Johnson reported positive 48-week data for its ulcerative colitis treatment, TREMFYA, showing significant clinical and endoscopic remission rates in the Phase 3 ASTRO study. Additionally, the company announced promising results for its investigational oral drug icotrokinra, which met the primary endpoint in a Phase 2b study for ulcerative colitis, with the highest dose achieving a 63.5% clinical response rate.
In the field of optometry, Johnson & Johnson presented data at a recent conference indicating that its ACUVUE OASYS MAX 1-Day for ASTIGMATISM contact lenses outperformed competitors in patient-reported outcomes, with 62% of patients preferring them for overall vision. Meanwhile, Wolfe Research has raised its price target for Johnson & Johnson to $200, maintaining an Outperform rating. The research firm cited growth opportunities from the company’s Innovative Medicine franchise as a reason for the increased target. These developments reflect a mix of legal challenges and promising advancements in Johnson & Johnson’s diverse portfolio.
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