To The Moon

$Johnson & Johnson(JNJ)$ is scheduled to announce Q4 earnings results on 23 Jan (Tuesday) before the market open. Next quarter’s earnings estimate for JNJ is $2.28 with a range of $2.25 to $2.30.

The previous quarter’s EPS was $2.66. JNJ beat its EPS estimate 100.00% of the time in the past 12 months, while its overall industry beat the EPS estimate 58.65% of the time in the same period. In the last calendar year JNJ has Outperformed its overall industry. Next quarter’s sales forecast for JNJ is $21.00B with a range of $20.19B to $21.35B.

The previous quarter’s sales results were $21.34B. JNJ beat its sales estimates 75.00% of the time in past 12 months, while its overall industry beat sales estimates 46.35% of the time in the same period. In the last calendar year JNJ has Outperformed its overall industry. $19.41 short of its 52-week high ($58.23), which the company reached on 21 July 2023.

Johnson & Johnson (JNJ) Technical

JNJ have been on a downtrend for a while and the short term moving average (20day) is about to make a bullish crossover. This suggest that it can be the beginning of a trend reversal.

Johnson & Johnson (JNJ) Earnings Guidance

JNJ has issued earnings guidance for FY 2024. EPS estimate in the range of 10.55 to 10.75, which would be a 31% increase from the prior year.

Johnson & Johnson (JNJ) Last Reported Earnings

JNJ last reported earnings on 17 Oct 2023 before the market open, and its shares declined -0.9% the day following the earnings announcement to close at 154.85. Following its earnings release, 96 days ago, JNJ stock has drifted +4.4% higher.

From the time it announced earnings, JNJ traded in a range between 143.80 and 163.28. The last price (161.68) is closer to the higher end of range. The implied straddle was 2.6% but we saw that JNJ decline after the announcement.

Johnson & Johnson (JNJ) Historical Moves Ahead of Earnings

JNJ stock had mixed performance leading up to earnings. Shares of Johnson & Johnson traded lower, on average, in the two weeks, one week, and one day periods heading into an earnings report. The best performance was three days ahead of earnings for an average gain of 0.3%.

Johnson & Johnson (JNJ) Historical Stock Price Reaction to Earnings

JNJ shares have moved higher in the immediate aftermath of earnings 7 out of 12 previous reports. On average the stock moved up 1.2% in the first day of trading after the company reported earnings.

Johnson & Johnson (JNJ) Stock Behavior After Earnings

Based on the previous 12 earnings releases, JNJ is more likely to trade lower 1 day after earnings for an average loss of -0.1%.

Johnson & Johnson (JNJ) Post Earnings Announcement Drift

JNJ share price has drifted up 4.4% post earnings announcement. Using the last 12 quarters data, the average drift between earnings announcements is 0.1%. The current drift represents a positive 0.8 standard deviation move.

• Current post earnings announcement drift: 4.4%

• Historical average post earnings announcement drift: 0.1%

• Historical post earnings drift standard deviation move: ±5.3%

There was a negative price effect even though JNJ have positive EPS beat and revenue beat.

Johnson & Johnson (JNJ) Post Earnings Movement

The options market overestimated JNJ stocks earnings move 67% of the time in the last 12 quarters. The predicted move after earnings announcement was ±2.6% on average vs an average of the actual earnings moves of 2.1% (in absolute terms).

Johnson & Johnson (JNJ) Earnings Implied Volatility Crush

JNJ's last earnings implied volatility (IV30) going into earnings was 18.3. The last time JNJ released earnings, the implied volatility dropped to 16.6, resulting in an implied vol crush of 9%. 5 days after earnings, the 30 day IV was 17.3.

• Average Implied Volatility Crush For JNJ Earnings: 11%

• Average 30 Day Implied Volatility 1 Day Before Earnings: 19.1

• Average JNJ 30 Day IV for the Day of Earnings: 17.1

• Average 30 Day Implied Volatility 5 Days After Earnings: 16.5

Johnson & Johnson (JNJ) Short Interest

Short percent of float is low which suggest that investors are pretty positive for JNJ future after its upcoming earnings announcement.

Summary

With bullish crossover nearing and also low short interest, these suggest that investors are pretty positive of JNJ future ahead of its earnings announcement. JNJ have quite a few approval from FDAs, and these should boost their sales in 2024.

Appreciate if you could share your thoughts in the comment section whether you think JNJ would continue its upside to a bullish crossover and help in its share price post earnings.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.