Morningstar

Johnson & Johnson Earnings: Firm Sees New Launches, Long-Term Guidance Looks Optimistic

We’ve raised our fair value estimate of Johnson & Johnson stock.

A sign for Johnson & Johnson is seen outside the headquarters.
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Securities in This Article
Johnson & Johnson
(JNJ)

Key Morningstar Metrics for Johnson & Johnson

  • Fair Value Estimate
    : $190.00
  • Morningstar Rating
    : ★
  • Morningstar Economic Moat Rating
    : Wide
  • Morningstar Uncertainty Rating
    : Low

What We Thought of Johnson & Johnson’s Earnings

Johnson & Johnson JNJ reported 9.9% sales growth and adjusted earnings per share down 2.5% in the first quarter. Management raised its 2026 growth guidance midpoints by 30 basis points to 7% on the top line and by 20 basis points to 5.7% for adjusted EPS. Shares were up 1% during April 14 trading.

Why it matters: While several biopharma peers have looming patent cliffs for large portions of their portfolios, we see continued steady growth at J&J, with no big future patent exposure until Tremfya in 2031.

  • Stelara’s patent cliff ($4.3 billion headwind in 2025) remains a significant drag on sales—we assume another $3 billion decline in 2026—but a strong portfolio is enabling J&J to grow through the headwind.

The bottom line: We’ve raised our fair value estimate for wide-moat J&J to $190 per share from $182 as we gain confidence in launches of new products like Inlexzo (bladder cancer, $3 billion peak) and Icotyde (immunology, $7 billion peak) and share gains for Tremfya (immunology, $14 billion peak).

  • Despite this increase, we think shares remain overvalued. The market is continuing to focus on near-term oncology and immunology growth as Stelara headwinds fade, while we are more cautious on heavy competition and long-term patent exposure.
  • J&J points to double-digit growth potential by the end of the decade (ahead of Tremfya’s patent expiration), which is still well above our forecast 5.8% five-year compound annual rate and 6.3% growth in 2029.

Coming up: Key data we’re watching in 2026 includes Icotyde data in psoriatic arthritis, JNJ-4804 phase 2 data in IBD, and milvexian data in both atrial fibrillation and secondary stroke prevention (around the end of 2026).

  • For competition, we’re watching for data for Abivax’s oral immunology drug obefazimod in inflammatory bowel disease (could compete with Icotyde in the long run) as well as Gilead’s potential late 2026 launch of CAR-T cell therapy anito-cel in multiple myeloma (cleaner safety profile than Carvykti).

Editor’s Note: This analysis was originally published as a stock note by Morningstar Equity Research.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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