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Shares of Johnson & Johnson (JNJ) are up 4% now after the drug and consumer products company reported first-quarter profit and sales that rose above expectations and boosted its dividend, offsetting a downbeat full-year outlook.
Johnson & Johnson (NYSE: JNJ) said on Tuesday its revenue for Q1 of 2020 amounted to $20.69 billion. Diluted GAAP earnings per share was $2.17 in the three-month period while adjusted EPS stood at $2.30. JNJ shares positively reacted to the announcement.
The company also announced earlier today that its board of directors declared a 6.3% increase in the quarterly dividend rate, from $0.95 per share to $1.01 per share. At the new rate, the indicated dividend on an annual basis is $4.04 per share compared to the previous rate of $3.80 per share.
Alex Gorsky, who is the company’s Chairman and Chief Executive Officer, said:
“Johnson & Johnson is built for times like this, and we are leveraging our scientific expertise, operational scale and financial strength in the effort to advance the work on our lead COVID-19 vaccine candidate. We are committed to beginning production at risk imminently and bringing an affordable and accessible vaccine to the public on a not-forprofit basis for emergency pandemic use.”
Dividend as a Sign of a Company’s Strength, JNJ Shares Price Is Rising
Chief Financial Officer Joseph Wolk said previously that “the dividend this morning is a real good sign of the strength of the company.” Wolk said the company was forecasting a 65% to 80% decline in elective procedures during the second quarter.
“What we saw in the first week was closer to that 65% range,” he said.
Wolk also mentioned that his belief is that the market is “confident” in the company, adding Johnson & Johnson “will get through the pandemic as a society.”
Johnson & Johnson shares (NYSE: JNJ) are up roughly 2% over the last 12 months but down about 4% year to date. JNJ shares were rising by 3.38% to $144.50 in the pre-market. And now as the trading session has begun, the stock price is $144.91 (+3.68%).
Pharmaceutical Business Brings Revenue of $11.13B
J&J’s pharmaceutical business managed to achieve revenues of $11.13 billion. Such results demonstrate an 8.7% year-over-year increase. The company’s consumer unit, which makes beauty products such as Neutrogena for example, generated $3.6 billion in revenue, which represents a 9.2% rise from a year earlier.
Johnson & Johnson is the first American drugmaker to report earnings post-COVID-19 outbreak, which has infected 1.9 million people worldwide and killed at least 120,449 as of Tuesday morning, according to data compiled by Johns Hopkins University.
Late last month, the company said human testing of its experimental vaccine for the coronavirus will begin by September and it could be available for emergency use authorization in early 2021.
J&J also committed more than $1 billion of investment in partnership with the federal Biomedical Advanced Research and Development Authority, which is part of the Department of Health and Human Services, to co-fund vaccine research.