How Will Johnson & Johnson Stock React To Its Upcoming Earnings?

Johnson & Johnson (NYSE:JNJ) is set to report its earnings on Tuesday, April 15, 2025. Consensus estimates predict earnings of $2.59 per share on sales of $21.6 billion for the current year. This compares to earnings of $2.71 per share on sales of $21.4 billion in the previous year. Several factors are expected to influence this performance. On the positive side, we anticipate continued growth in sales for key drugs like Darzalex, as well as newer medications such as Erleada and Spravato. However, a significant headwind is the expected decline in Stelara sales due to the introduction of biosimilar competition. Meanwhile, the company’s MedTech business is projected to continue its strong performance, driven by increased sales in the cardiovascular segment. This growth is notably supported by the impact of the Shockwave Medical acquisition completed in May of last year.

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With a current market capitalization of $363 billion, the company generated $89 billion in revenue over the last twelve months. This resulted in operational profitability, with $22 billion in operating profits and a net income of $14 billion. Notably, JNJ stock has outperformed the broader market this year, showing a 5% increase. This is in contrast to the S&P 500, which, despite a significant 10% recovery following President Trump’s announcement of a 90-day pause on reciprocal tariffs for most countries, remains 7% lower year-to-date. This outperformance of pharmaceutical stocks like JNJ can be attributed to their role as defensive plays during uncertain economic times, a trend that is evident in the current downturn.

While a lot will depend on how results stack up against consensus and expectations, understanding historical patterns might just turn the odds in your favor if you are an event-driven trader. There are two ways to do that: understand the historical odds and position yourself prior to the earnings release, or look at the correlation between immediate and medium-term returns post earnings and position yourself accordingly after the earnings are released. That said, if you seek upside with lower volatility than individual stocks, the Trefis High-Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 91% since its inception.

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Johnson & Johnson’s Historical Odds Of Positive Post-Earnings Return

Some observations on one-day (1D) post-earnings returns:

• There are 20 earnings data points recorded over the last five years, with 12 positive and 8 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 60% of the time.
• However, this percentage decreases to 42% if we consider data for the last 3 years instead of 5.
• Median of the 12 positive returns = 2.5%, and median of the 8 negative returns = -1.8%

Additional data for observed 5-Day (5D), and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.

JNJ observed 1D, 5D, and 21D returns post earnings

Correlation Between 1D, 5D, and 21D Historical Returns

A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if 1D post-earnings return is positive. Here is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.

JNJ Correlation Between 1D, 5D and 21D Historical Returns

Is There Any Correlation With Peer Earnings?

Sometimes, peer performance can have influence on post-earnings stock reaction. In fact, the pricing-in might begin before the earnings are announced. Here is some historical data on the past post-earnings performance of Johnson & Johnson stock compared with the stock performance of peers that reported earnings just before Johnson & Johnson. For fair comparison, peer stock returns also represent post-earnings one-day (1D) returns.

JNJ Correlation With Peer Earnings

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