Johnson & Johnson's medical devices segment, known as MedTech, offers products in the orthopedics, surgery, cardiovascular and vision markets. The MedTech segment accounts for around 36% of J&J’s total revenues.\n\nIn the second quarter, MedTech segment sales came in at $8.54 billion, up 7.3% from the year-ago period, including an operational increase of 6.1% and a positive currency impact of 1.2%. MedTech segment sales beat the Zacks Consensus Estimate of $8.25 billion.\n\nExcluding the impact of all acquisitions and divestitures, and currency, on an adjusted operational basis, worldwide sales rose 4.1%, driven by strong momentum in Cardiovascular, Surgery and Vision.\n\nIn the MedTech segment, sales rose 8.0% in the United States and 4.1% outside of the United States on an operational basis. The MedTech business improved from the first-quarter levels, driven by the newly acquired cardiovascular businesses, Abiomed and Shockwave, as well as in Surgical Vision and wound closure in Surgery. Moreover, improvements in J&J’s electrophysiology business also drove the sequential growth.\n\nHowever, the company continues to face headwinds in China. Sales in China are being hurt by the impact of the volume-based procurement (VBP) program. VBP is a government-driven cost containment effort in China.\n\nJ&J looks confident about sustaining the improvement in the MedTech segment in the second half of the year. Sales are expected to be higher in the second half than the first half as the business moves past tougher first-half comps and new products gain momentum throughout 2025. Increased adoption of newly launched products in Cardiovascular, Surgery and Vision is likely to drive growth in the second half.\n\nHowever, J&J expects continued impacts from VBP issues in China in 2025 as the program continues to expand across provinces and products.\n\nJ&J’s MedTech unit faces strong competition from several major players in the medical device industry like Medtronic (MDT), Abbott, Stryker (SYK) and Boston Scientific (BSX).\n\nWhile Medtronic has a strong presence in cardiovascular, neuroscience and surgical technologies, Stryker is a global leader in medical technology, specializing in innovative solutions across surgical, neurotechnology, orthopedics and spine care. Boston Scientific markets products for cardiovascular, endoscopy, urology and neuromodulation. Abbott is known for its medical device products across cardiovascular, diagnostics and diabetes care.\n\nJ&J’s shares have outperformed the industry year to date. The stock has risen 22.2% in the year-to-date period against a 6.7% decrease of the industry.\n\nFrom a valuation standpoint, J&J is expensive. Going by the price/earnings ratio, the company’s shares currently trade at 15.57 forward earnings, higher than 13.71 for the industry. The stock is, however, trading below its five-year mean of 15.66.\n\nThe Zacks Consensus Estimate for 2025 earnings has risen from $10.64 per share to $10.86 per share for 2025 and from $11.07 per share to $11.36 per share over the past 30 days.\n\nJ&J has a Zacks Rank #2 (Buy) currently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.\n\nFrom thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.\n\nThis company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.

J&J's MedTech Unit Sales Improve In Q2: Will The Upside Continue?

Johnson & Johnson's medical devices segment, MedTech, reported strong second-quarter sales of $8.54 billion, up 7.3% year-over-year, exceeding the Zacks Consensus Estimate of $8.25 billion. Sales growth was driven by strong performance in cardiovascular, surgery, and vision markets, with operational growth of 6.1% and a positive currency impact of 1.2%. Excluding acquisitions, divestitures, and currency, adjusted operational sales rose 4.1%. U.S. sales increased 8.0% and international sales rose 4.1% on an operational basis. Growth was fueled by newly acquired cardiovascular businesses Abiomed and Shockwave, as well as improvements in surgical vision and wound closure. However, sales in China are being negatively impacted by the government's volume-based procurement (VBP) program. J&J expects continued improvement in the second half of 2025 as new products gain momentum, though VBP-related headwinds are expected to persist. The company outperformed the industry in stock performance, rising 22.2% year-to-date versus a 6.7% industry decline. J&J trades at a forward P/E of 15.57, above the industry average of 13.71 but below its five-year mean of 15.66. The Zacks Consensus Estimate for 2025 earnings has increased from $10.64 to $10.86 per share, with a recent 30-day update to $11.36 per share. J&J holds a Zacks Rank #2 (Buy).