Johnson & Johnson
Over the past 12 months, pharmaceuticals giant and Dow component Johnson & Johnson (NYSE: JNJ) has dropped about 8.7% from its share price.
Earlier this month, Johnson & Johnson took another swing at a bankruptcy filing for its LTL Management subsidiary, a device to insulate the company from massive outstanding damage claims for its allegedly unsafe talc products. This time, it agreed to an $8.9 billion settlement as part of the bankruptcy deal. The court has yet to rule on whether this second filing was made in “good faith,” a hurdle the court said it did not meet when LTL first filed for bankruptcy in 2021. Most observers think the second filing is an even-money bet.
Of 22 brokerages covering the stock, eight have Buy or Strong Buy ratings and the rest rate it at Hold. At a share price of around $165.00, the upside potential based on a median price target of $176.00 is about 6.7%. At the high target of $215.00, the upside potential is 30.3%.
First-quarter revenue is forecast at $23.63 billion, up 6.7% sequentially and less than 1% higher year over year. Adjusted EPS are expected to come in at $2.51, down 12.2% sequentially and by 6.0% year over year. For the full 2023 fiscal year, analysts expect EPS of $10.51, up 3.6%, on sales of $97.63 billion, up 2.8%.
Shares trade at 15.7 times expected 2023 EPS, 15.1 times estimated 2024 earnings of $10.93 and 14.6 times estimated 2025 earnings of $11.31 per share. The stock’s 52-week range is $150.11 to $186.69. The company pays an annual dividend of $4.52 (yield of 2.76%). Total shareholder return for the past year was negative 6.26%.
Lockheed Martin
Over the past 12 months, shares of Lockheed Martin Corp. (NYSE: LMT) have added about 4.1%, including a drop of more than 16% logged through mid-October. Since then, the stock has added about 27%, and for the year to date, shares are up by less than 1%.
Lockheed’s problems may be due to the success it racked up in the second half of 2022. Even lavish defense spending for this and the next fiscal years is not expected to duplicate Lockheed’s big numbers from last year. Lockheed boosted its share buybacks in the second half of 2022 in order to avoid the buyback tax that went into effect in January. Now, a buyback boost may not be as welcome as it once was.
Just seven of 22 brokerages covering the company have a Buy rating, compared to 13 with Hold ratings. At a price of around $488.00 a share, the upside potential based on a median price target of $505.00 is 3.5%. At the high price target of $774.00, the upside potential is 58.6%.
First-quarter revenue is forecast at $15.03 billion, down nearly 21% sequentially but 0.05% higher year over year. Adjusted EPS are expected to come in at $6.06, down 22.2% sequentially and by 5.9% year over year. For the full 2023 fiscal year, Lockheed is expected to post EPS of $26.71, down 1.9%, on sales of $65.66 billion, down 0.5%.
Lockheed stock trades at 18.3 times expected 2023 EPS, 17.4 times estimated 2024 earnings of $28.07 and 17.0 times estimated 2025 earnings of $28.74 per share. The stock’s 52-week range is $373.67 to $498.95, and Lockheed pays an annual dividend of $12.00 (yield of 2.46%). Total shareholder return over the past 12 months was 6.92%.
Originally published at 24/7 Wall St.
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