/Johnson%20%26%20Johnson%20location%20sign-by%20JHVEPhoto%20via%20iStock.jpg)
New Jersey-based Johnson & Johnson (JNJ) is a global healthcare powerhouse valued at $355.71 billion by market cap. It researches, develops, manufactures, and sells a wide range of healthcare products worldwide. Competing fiercely with other healthcare giants, one of JNJ's main rivals is Pfizer Inc. (PFE), which also has a strong presence in pharmaceuticals and consumer health.
Companies worth $200 billion or more are generally described as “mega-cap stocks,” and JNJ fits right into that category. Its market cap exceeds this threshold, reflecting its substantial size, stability, and influence in the healthcare sector. The healthcare giant has pivoted toward innovation and self-reliance through multiple acquisitions over the past years.
Shares of JNJ are currently trading 17.1% below their 52-week high of $175.97, which they hit on Aug. 10. The stock has declined 8.8% over the past three months, underperforming the iShares U.S. Pharmaceuticals ETF’s (IHE) 2.2% decline over the same time frame.
Over the longer term, JNJ has also underperformed, with a YTD decline of 6.9% and a 7.8% decline over the past 52 weeks. In comparison, the IHE has gained 7.3% in 2024 and achieved a significant 13% rally over the past year.
To confirm the bearish price trend, JNJ has been trading below its 50-day moving average since late May and its 200-day moving average since mid-March.
JNJ's underperformance compared to other pharma stocks can be attributed to several factors, including ongoing supply constraints at Carvykti, weaker-than-expected medical device sales, the loss of Stelara exclusivity, and financial impacts from its subsidiary's potential bankruptcy. Additionally, JNJ's stock declined 2.1% on Apr. 16 following a mixed Q1 earnings release. The healthcare giant is also selling its Kenvue stake to focus on core businesses amid stock declines and legal issues over talcum powder.
Highlighting the contrast in performance, JNJ's competitor, Pfizer, has significantly underperformed JNJ, losing 23.5% over the last 52 weeks. It also lagged behind IHE over this period.
Despite its underperformance, analysts are moderately optimistic about JNJ's prospects. The stock has a consensus rating of "Moderate Buy" from 20 analysts in coverage. The mean price target of $172.97 reflects an 18.5% premium over current levels.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
