Earnings Watch: Johnson & Johnson earnings: What to expect

Estimize, which crowdsources projections from hedge funds, academics, buy and sell-side traders and others, is expecting EPS of $2.58.

Revenue: The FactSet consensus calls for $21.036 billion in revenue, down from $23.791 billion a year ago. Estimize is expecting revenue of $21.583 billion.

Stock movement: J&J’s stock has fallen 11% in the year to date, while the Dow Jones Industrial Average
DJIA
has gained 2.6% and the S&P 500
SPX
has gained 14%.

Of the 18 analysts tracked by FactSet who cover J&J shares, 10 have a buy rating, seven have a hold rating and one is underweight, or sell.

What else to watch for

J&J is not expected to produce many surprises with its numbers, now that the Kenvue
KVUE,
+0.88%
spinoff is completed, according to JPMorgan analysts. Kenvue houses the company’ consumer health business which includes a host of household name brands, including Tylenol, Listerine, Band-Aid, Neutrogena and Nicorette.

 “We continue to see solid fundamentals for the business with a pipeline that has strengthened over recent years and a MedTech portfolio that is showing strong growth as the business recovers post COVID,” they wrote in a recent note to clients.

The only overhang is the uncertainty created by lawsuits stemming from the company’s talcum powder business. In July, a judge tossed a potential $9 billion settlement which J&J was attempting to achieve through the bankruptcy of a unit. In September, a New Jersey judge overseeing all of the litigation said that another 11,000 complaints had been filed.

“Net-net, we remain on the sidelines given the uncertainty on talc dynamics, but we do see the risk/reward skewing more positively for JNJ shares from the fundamental improvements seen with the business this year and with the recent KVUE separation cleaning up the story for investors,” said the analysts.