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UPDATE 3-J&J raises sales forecast but keeps profit outlook unchanged; shares drop

From Reuters - April 17, 2018

(Reuters) - Johnson & Johnson (JNJ.N) raised its sales forecast for the year on Tuesday but kept its outlook for full-year profit unchanged, disappointing investors and sending its shares down 1.6 percent.

The healthcare conglomerate, whose stock had climbed about 3 percent over the previous six days, reported better-than-expected profit in the first quarter, helped by strong demand for its cancer treatments.

J&J said it was not revising its earnings forecast higher for the year because certain divestments it previously expected to make this year might be pushed into 2019.

Im definitely surprised by the stock reaction, said Gabelli Funds portfolio manager Jeff Jonas. There was some expectation that they would raise EPS guidance this quarter just because foreign exchange has gotten better and the business did do pretty well.

Shares were down $1.99 at $129.63 in late morning trading on the New York Stock Exchange.

Quarterly sales of its cancer treatments surged 45 percent to $2.31 billion, accounting for nearly a quarter of its pharmaceutical units revenue.

The companys blockbuster rheumatoid arthritis drug Remicade has come under pressure from cheaper copies, pushing the company to focus on newer treatments such as cancer drugs. Remicades first-quarter sales fell 16.9 percent to $1.39 billion.

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