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JNJ and ABT: How Their Revenue Guidance Stacks Up

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Jan. 22 2019, Updated 3:35 p.m. ET

Revenue guidance

In its third-quarter earnings press release, Johnson & Johnson (JNJ) forecasted its revenues for fiscal 2018 to be in the range of $81.0 billion to $81.4 billion. In its third-quarter earnings conference call, the company projected sales in the range of $80.6 billion to $81.0 billion on a constant currency basis for fiscal 2018. The company has assumed YoY operational sales growth in the range of 5.5% to 6.0% for fiscal 2018. Excluding the impact of acquisitions and divestitures, the company has estimated operational sales growth for fiscal 2018 to fall in the range of 4.5% to 5.0%.

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According to Johnson & Johnson’s third-quarter earnings conference call, the company has assumed the negative impact of generic and biosimilar erosion of its key drugs such as Concerta, Velcade, Tracleer, Procrit, and Remicade, in its fiscal 2018 sales guidance. In its third-quarter earnings conference call, Abbott Laboratories (ABT) has projected YoY organic growth of 7% in its sales in fiscal 2018. The company is also anticipating a small negative impact on revenues attributable to unfavorable foreign exchange fluctuations.

Wall Street estimates

Wall Street analysts have projected Johnson & Johnson’s revenues to be $81.34 billion, $82.68 billion, and $86.41 billion, for fiscal 2018, fiscal 2019, and fiscal 2020, respectively, which implies YoY revenue growth of 6.43%, 1.61%, and 4.51% for fiscal 2018, fiscal 2019, and fiscal 2020, respectively.

On the other hand, Wall Street analysts have projected Abbott Laboratories’ revenues to be $30.65 billion, $32.19 billion, and $34.36 billion, for fiscal 2018, fiscal 2019, and fiscal 2020, respectively. These estimates imply YoY revenue growth rates of 11.91%, 5.01%, and 6.74% for fiscal 2018, fiscal 2019, and fiscal 2020, respectively.

Abbott Laboratories is expected to report a faster rise in revenues as compared to Johnson & Johnson from 2018 to 2020.

In the next article, we’ll compare the earnings growth prospects of Johnson & Johnson and Abbott Laboratories in greater detail.

 

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