J&J Targets $100B+ Sales in 2026 as Growth Accelerates in Both Units

On its fourth-quarter earnings conference call on Jan. 21, Johnson & Johnson JNJ announced its financial outlook for 2026, which exceeded consensus expectations.

J&J said it expects sales in the range of $100.0 billion-$101.0 billion in 2026. This range was slightly higher than the then Zacks Consensus Estimate of $98.5 billion. Adjusted earnings per share are expected to be in the range of $11.43-$11.63.

J&J expects accelerated growth in both the Innovative Medicine and MedTech segments in 2026.

In 2025, Innovative Medicine Unit’s sales rose 4.1% on an operational basis to $60.4 billion. In 2026, J&J expects accelerated growth in the Innovative Medicine segment despite the loss of exclusivity (“LOE”) of blockbuster drug, Stelara. Several biosimilar versions of J&J’s multi-billion-dollar immunology drug, Stelara, were launched in the United States in 2025 as the drug lost patent exclusivity.

According to patent settlements and license agreements, Amgen AMGN, Teva Pharmaceutical Industries TEVA, Samsung Bioepis/Sandoz and some other companies launched Stelara biosimilars in 2025. Stelara’s LOE negatively impacted the Innovative Medicines segment’s growth by 1040 basis points in 2025. In 2026, J&J expects the Stelara LOE impact to be more pronounced. In addition, J&J expects generic impact for both Simponi and Opsumit to begin in 2026 as the drugs lose patent protection.

However, despite the generic erosion, Innovative Medicine Unit’s growth in 2026 is expected to be driven by its key products, such as Darzalex, Tremfya, Spravato, Carvykti and Erleada, as well as new launches like Rybrevant plus Lazcluze in non-small cell lung cancer and Caplyta in major depressive disorder (MDD) indication. Caplyta was approved as an adjunctive treatment for MDD in November 2025.

J&J expects a more pronounced impact from new products in 2026, as it launched some key new products in 2025, like Inlexzoh/TAR-200, a first-of-its-kind drug-releasing system, for treating high-risk non-muscle invasive bladder cancer and Imaavy (nipocalimab) for treating generalized myasthenia gravis. Regulatory applications were recently filed for another key candidate, Icotyde/icotrokinra, for moderate-to-severe plaque psoriasis, which is likely to be approved in 2026.

J&J’s MedTech business has also improved in the past three quarters. MedTech sales rose 4.3% on an organic basis to $33.8 billion in 2025. In 2026, J&J expects better growth in the Medtech segment than 2025 levels, driven by increased adoption of newly launched products across Cardiovascular, Surgery and Vision portfolios. It, however, expects some additional rounds of impact from the volume-based procurement (VBP) program in China in 2026. VBP is a government-driven cost containment effort in China.

Overall, J&J expects stronger momentum across both Innovative Medicine and MedTech in 2026, even as it faces heightened generic pressure for key products. With new launches gaining traction and broader adoption of recently introduced MedTech products, the company is positioning itself to offset patent headwinds and drive accelerated growth in the coming year.

JNJ’s Price Performance, Valuation and Estimates

J&J’s shares have outperformed the industry in the past year. The stock has risen 47.3% in the past year compared with a 19.3% increase of the industry.

From a valuation standpoint, J&J is slightly expensive. Going by the price/earnings ratio, the company’s shares currently trade at 19.11 forward earnings, higher than 18.33 for the industry. The stock is also trading above its five-year mean of 15.65.

The Zacks Consensus Estimate for 2026 earnings has risen from $11.46 to $11.53 over the past seven days, while that for 2027 has gone up from $12.25 per share to $12.33 per share over the same timeframe. EPS estimates have moved up in response to J&J’s optimistic 2026 financial outlook

J&J has a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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