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Johnson & Johnson’s 2Q17 Estimates: Consumer Healthcare

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Jul. 17 2017, Updated 7:38 a.m. ET

Consumer Healthcare

Johnson & Johnson’s (JNJ) Consumer Healthcare segment includes the baby care, oral care, skincare, over-the-counter products, women’s health, and wound care franchises. 

The segment is expected to see positive growth in its operational revenue in 2Q17.

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Baby care

Baby care revenue is expected to fall due to the consumer shift to premium products in the US market in 2Q17. However, JNJ’s acquisition of Hipoglos should substantially offset this fall.

Beauty

The beauty franchise, formerly referred to as the skincare franchise, is expected to report a revenue rise in 2Q17 following its inclusion of acquired products from Vogue International, Light Mask, and NeoStrata in the United States. This rise is expected to be partially offset by lower sales of Neutrogena.

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Over-the-counter

The over-the-counter franchise’s revenue is expected to rise in 2Q17 due to the strong performances of analgesics, Tylenol, and upper respiratory products. This growth will likely be partially offset by lower sales of Rhinocort and allergy medication Zyrtec and the divestiture of the BeTotal brand.

Oral care

The oral care franchise’s revenue is expected to fall in 2Q17 following weak Listerine products sales worldwide.

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Women’s health

The women’s health franchise’s revenue is expected to fall in 2Q17 due to JNJ’s divestment of the TUCKS brand.

Wound care and others

The wound care franchise’s revenue is expected to fall in 2Q17 due to JNJ’s divestment of the Splenda brand of products.

To divest company-specific risk, investors can consider ETFs such as the iShares US Pharmaceuticals ETF (IHE), which holds 9.4% of its total assets in Johnson & Johnson. IHE also holds 8.0% in Pfizer (PFE), 6.1% in Eli Lilly and Company (LLY), and 5.6% in Bristol-Myers Squibb (BMY).

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