What's Next For JNJ Stock After An Upbeat Q4?

Core Viewpoint - Johnson & Johnson (J&J) reported Q4 results that exceeded street estimates, but the stock fell 2% post-announcement despite strong revenue and earnings growth [1][6]. Financial Performance - J&J's Q4 revenue was $22.5 billion, a 5.3$2.04 per share, surpassing consensus estimates of $22.4 billion and$2.02 per share [1][3]. - The Innovative Medicine segment grew by 4.4%, while the MedTech segment saw a 6.7% increase, driven by strong sales in cardiovascular products [3]. - Darzalex sales rose 21% year-over-year, contributing significantly to pharmaceutical growth, while Stelara's revenue fell 15% to 2.3 billion due to biosimilar competition [3][4]. Margin and Earnings Outlook - J&J's gross margin improved by 180 basis points year-over-year to 68.3%, although adjusted earnings per share decreased from 2.29 in the prior year [4]. - The company provided a 2025 sales outlook of $91.5 billion and adjusted earnings of$10.85 per share, exceeding consensus estimates [5]. Stock Performance and Valuation - J&J stock has underperformed the S&P 500, with a -4% return since the beginning of 2024, while the S&P 500 is up 28% [2][6]. - The stock is currently trading at 13 times forward expected earnings, which is lower than its average P/E ratio of 17 over the past five years, indicating potential for growth [7].