Johnson & Johnson beats on earnings, revenue despite strong dollar drag

JNJ growth driven by pharma biz: Expert

Johnson & Johnson on Tuesday reported quarterly earnings that beat Wall Street expectations, despite a 7.2 percent drag on the strong dollar.

The diversified health care giant also lowered 2015 financial guidance due to further negative foreign currency movements.

"People can figure out what the move in the currency has been, and we're fairly used to this. This was already factored in to expectations. So you see now impact from the lower guidance," Barbara Ryan, partner at strategic adviser Clermont Partners, said shortly after the release. "They lowered guidance back in January because of the rise in the dollar. But it's gotten worse."

J&J posted first quarter earnings of $1.56 per share, up from $1.54 a share in the year-earlier period. Revenue dropped to $17.4 billion from $18.1 billion a year ago.

Analysts expected earnings of $1.54 per share on revenue of $17.31 billion.

After the announcement. J&J's stock rose in premarket trading. (Click here for the latest price.)

Year to date, Johnson & Johnson has underperformed the broader S&P 500 pharmaceutical industry. While the group has risen 5 percent year, J&J was down more than 3 percent in 2015.

"A lot of the outperformance has been drive by multiple expansion," said Ryan, who specializes in health care and life sciences.

She predicted that investors will be much more focused on individual product portfolios. While J&J has been strong in pharma, she added, there are concerns about increased competition from rivals.

Sign Up for Our Newsletter Morning Squawk

CNBC's before the bell news roundup
Get this delivered to your inbox, and more info about about our products and services.
By signing up for newsletters, you are agreeing to our Terms of Use and Privacy Policy.