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Johnson & Johnson’s Revenue Continues to Grow in 2Q17

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Johnson & Johnson’s revenue

Johnson & Johnson (JNJ) reported ~2% growth in its top line to $18.8 billion in 2Q17, compared with $18.5 billion in 2Q16. The company surpassed analysts’ EPS (earnings-per-share) estimate of of $1.80 with EPS of $1.83.

The above chart shows Johnson & Johnson’s revenue over the last few quarters. As the company reports over 48% of its total revenue from outside US markets, the company is largely exposed to currency risk.

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Revenue performance in 2Q17

As discussed earlier, Johnson & Johnson’s top line improved by 1.9% to reach ~$18.8 billion in 2Q17. This figure includes an operating revenue increase of 2.9%, and saw a 1% impact due to foreign exchange.

In operating revenue, the pharmaceuticals segment reported 1% growth, the consumer segment reported 2.3% growth, and the medical devices segment reported 5.9% growth between 2Q16 and 2Q17.

US markets reported revenue of $9.7 billion in 2Q17, 1.6% growth from 2Q16. US markets are Johnson & Johnson’s largest revenue contributor, generating ~51.6% of its total revenue. Outside US markets, the company reported revenue of $9.1 billion in 2Q17, representing 4.4% growth. This figure was partially offset by a 2.1% foreign exchange impact.

To divest company-specific-risks, investors could consider the iShares US Healthcare ETF (IYH), which has an 11.5% exposure to Johnson & Johnson (JNJ). IYH also holds 6.3% of its total assets in Pfizer (PFE), 5.4% in Merck and Co. (MRK), and 3.1% in Gilead Sciences (GILD).

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