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Johnson & Johnson reports mixed Q1 earnings, narrows guidance

Johnson & Johnson (JNJ) reported a mixed bag of first quarter results, missing revenue estimates but beating on the bottom line. The company's revenue came in at $21.38 billion, slightly below the street's expectation of $21.39 billion. However, Johnson & Johnson managed to surpass analyst estimates on adjusted earnings per share (EPS), posting $2.71 versus the expected $2.65.

Yahoo Finance's Anjalee Khemlani breaks down the details of the earnings report, highlighting the company's pharmaceutical sector developments.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Angel Smith

Video transcript

[AUDIO LOGO]

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- Let's take a look at some trending tickers here this morning. Johnson & Johnson reporting sales rising 2% in the first quarter from a year ago. But shares falling after the health care giant narrowed its full year guidance to down a fraction of a percent. Here, Yahoo Finance's Anjalee Khemlani has been digging into the results here. What have you found on J & J?

- That's right, Brad. We know, of course, Johnson & Johnson is a strong company. So, no surprise there on the numbers. A slight miss there, and a little bit of a drop from Stelara-- its blockbuster drug that the company is bracing for competition from next year as it loses its patent. But as you can see, the numbers on the screen-- a little bit of a miss on the revenues but beating on earnings.

The pharma part of the business, really the bulk of it-- So, 13.6 billion from pharma. Specifically, in oncology and immunology. Oncology, a really big space for competition right now across the pharma sector.

And J&J doing well there, scooping up what are known as ADCs-- Antibody Drug Conjugates. And that's a really big player. Or sort of platform right now for pharma players. So, they're doing well there.

Meanwhile, MedTech is an interesting story for them. $7.8 billion from there this quarter. And surgery and orthopedics are a big part of that portfolio, but cardiology is where the company is looking. In particular, because of the fact that cardiovascular deaths are higher of a risk for the country. And so that's something that is really interesting.

They've also got that new acquisition with Shockwave. And that's where they're looking to boost their portfolio after they've split off that consumer. And so MedTech has kind of been sleepy for a while, if you will. And they're really looking to pump it up.

I had a chance to speak to Chief Financial Officer, Joe Wolk, earlier. And he did talk about the company of looking to stay steady and grow. First noting in the dividend sector, they're up 2.4%. 62nd consecutive year for that.

And Joe told me that they can count-- people can count on J&J to hit their numbers, barring some catastrophic event, because they know that they're part of a number of dividend funds, and they are looking at not breaking the streak. Both the CEOs, prior and current, are looking at that.

Meanwhile, as I mentioned, for that MedTech focus. It has been sleepy for a while. 1.5% growth in 2017 versus 7.8% just last year. So, that's sort of the story, I think, for J&J this year-- is looking at those areas of growth, bracing for that pharma impact, and getting back to the basics of what the company is really known for.