In a recent turn of events, Johnson & Johnson's (JNJ) stock has been struggling, trading below both its 200-day and 50-day moving averages as of late June. On July 3, the stock closed at $145.69, slipping beneath its 50-day moving average of $147.61 and the 200-day moving average of $151.95.
JNJ Stock Lags Behind Industry, Sector & S&P 500
The Zacks Consensus Estimate for earnings has also taken a hit for the years 2024 and 2025, signaling a downward trajectory.
Legal Challenges and More for J&J
Johnson & Johnson is currently entangled in a web of lawsuits concerning personal injuries linked to its talc and opioid products. With over 60,000 lawsuits revolving around its talc-based items, J&J is feeling the heat. Moreover, the anticipated patent expiry of the blockbuster drug Stelara in 2025 looms as a threat to its revenue stream.
A Resilient Giant in the Pharma World
In spite of the hurdles, J&J's diverse business structure stands out as a pillar of strength, enabling the corporation to weather economic fluctuations adeptly. The Innovative Medicines division has demonstrated steady growth, eyeing a milestone of $60 billion by 2025.
Upward Trajectory for MedTech Segment
J&J's MedTech arm is witnessing an upswing, capitalizing on the rebound in surgical procedures and strategic purchases. The company's compelling valuation and dividend return make it an attractive option for investors.
In summary, while legal troubles continue to cast a shadow over J&J's stock performance, the company's diversified business framework and growth potential remain robust. Prospective investors are urged to scrutinize the possible risks tied to the ongoing legal disputes prior to delving into investment decisions.