Street Calls of the Week
Investing.com -- Johnson & Johnson’s push into new medicines has helped it offset the loss of revenue from its blockbuster Stelara treatment, according to Guggenheim which upgraded the stock to Buy.
The brokerage raised its target price to $206 from $167, citing confidence in the company’s lineup of treatments across oncology, immunology and neuroscience.
“We are impressed by the top-line growth JNJ has delivered so far in FY 2025, despite the loss of market exclusivity for their $10Bn+ asset, Stelara,” the analyst at Guggenheim said.
Guggenheim said Johnson & Johnson’s recently launched bladder cancer drugs Inlexzo (TAR-200) and TAR-210 could generate more than $6 billion in sales at peak.
It also pointed to Darzalex, a multiple myeloma therapy, and Rybrevant, a lung cancer drug, as medicines with greater staying power than the market currently assumes.
“Knowledge regarding managing Rybrevant’s side effects should allow for Rybrevant/Lazcluze to gain traction in lung cancer, with data in head and neck cancer expected by year-end,” the analysts said.
In immunology, Guggenheim expects psoriasis treatment Tremfya to reach more than $9 billion in potential peak sales, while it sees icotrokinra nearing approval in 2026.
In neuroscience, it raised its estimates for Caplyta and Spravato, projecting more than $5 billion and $3.5 billion in sales respectively.
The analysts added that the company’s performance in 2025 has eased concerns over Stelara’s patent loss and put it in position for stronger growth in 2026 and beyond. J&J shares have risen about 13% since mid-July, outpacing the S&P 500’s 6.5% gain in the same period.
“Continued progress with key marketed and pipeline assets should meaningfully increase investors’ expectations for JNJ’s growth outlook in 2027 and beyond.”