Why did Johnson & Johnson move?
Written after the close on
Johnson & Johnson fell in the last session, likely on caution ahead of its mid-October earnings. Over the last five trading days Johnson & Johnson fell sharply while the S&P 500 was roughly flat and the healthcare sector fell sharply too, so the drop was bigger than both its market and its sector. The most likely driver is the looming third-quarter report in mid-October, with investors focused on whether newer drugs can offset declining sales of the older psoriasis drug Stelara as cheaper copies take hold. Bank of America nearly doubled its peak sales estimate for a new psoriasis pill after a physician survey, a supportive signal that partly cushions the cautious mood. What to watch next is that mid-October earnings report, where growth in the Innovative Medicine unit and the drug pipeline will be the key test.
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Earlier this week
Johnson & Johnson was little changed over the last five trading days, holding up better than a clearly weaker S&P 500 while the healthcare sector edged higher, so it moved against its sector; in the latest session it fell clearly, more than a slightly lower sector and a roughly flat market. News that the company returned $84.7 billion to owners over five years through dividends and buybacks (buybacks are when a company purchases its own shares) mostly framed valuation debate rather than moving the stock. Watch the mid-October report, where guidance and pipeline data on drugs like Icotyde and IMAAVY will matter most.