Profit better than expected

US-based Johnson & Johnson (NYSE:JNJ), the world's largest manufacturer of health products, saw its net income fall 2.3 times to $1.738 billion, or $0.65 per share, in the fourth quarter of 2020, down from $4.01 billion, or $1.5 per share, earned in the same period last year. Adjusted earnings were $1.86 per share, down 1.1% year-on-year.

J&J's revenue rose 8.3% to $22.475 billion from $20.747 billion a year earlier, the company said in a press release.

The performance beat forecasts. Analysts polled by FactSet had on average forecast adjusted earnings of $1.82 per share on revenue of $21.6bn.

Sales of consumer healthcare products rose 1.4% to $3.62 billion in the third quarter, with the pharmaceuticals division recording a 16.3% increase to $12.27 billion. The medical devices division saw sales decline 0.7% to $6.59 billion.

For 2020, J&J's net profit fell to $14.714bn, or $5.51 per share, from $15.119bn, or $5.63 per share, in 2019. Revenue rose 0.6% to $82.584 billion.

The company expects adjusted earnings in 2021 to grow 17.1-19.6% and be in the range of $9.4-9.6 per share, while revenue will increase 9.5-11% to $90.5 billion to $91.7 billion.

FactSet analysts forecast J&J revenue for the current year at $88.59bn with adjusted earnings of $8.96 per share.

CEO and chairman Alex Gorsky said J&J plans to unveil the results of its phase III trial of its coronavirus vaccine soon.

J&J's share price is rising in pre-market trading on Tuesday. The company's capitalisation is up 11.9% in the last 12 months, while the S&P 500 index is up 17%.