Shares of Johnson & Johnson (NYSE:JNJ) surged to a 52-week high today after the healthcare conglomerate boosted its 2012 earnings forecast after reporting a solid, Street-beating quarter (and despite a nearly 18% bottom-line slide).
JNJ shares hit $69.80 this morning before subsiding to $69.42 as of about 12:20 p.m. Shares opened up about 1% today at $69.30.
The New Brunswick, N.J.-based healthcare giant posted profits of $2.63 billion, or $1.05 per diluted share, on sales of $17.05 billion during the 3 months ended Sept. 30.
That amounts to a 6.5% top-line gain, but a 17.9% bottom-line slide. Still, adjusted to exclude 1-time items, J&J reported EPS of $1.25 per share, beating The Street’s estimate of $1.21.
The company now expects to post adjusted 2012 EPS of $5.05-$5.10 per share, up from $5.00-$5.07 last quarter and approaching its Q1 outlook of $5.05-$5.15 apiece.
CFO Dominic Caruso told analysts on a conference call that J&J’s $20 billion buyout of Swiss orthopedics giant Synthes added 5.8% to operating sales growth. The addition was reflected in the orthopedics segment, which saw total sales jump 65.5%, from $1.38 billion during Q3 last year to $2.29 billion during Q3 2012.
The medical device division, which is the world’s largest medtech player, "is challenged by the lower procedure volumes," Caruso said during the call.
"Offsetting that, we now have Synthes as a member of the Johnson & Johnson family of companies, having a large presence in orthopedics," he said. "That should help us continue growth in that business."
Asked about the Synthes integration and the possibility of layoffs, Caruso said none are planned as yet but didn’t take the option off the table completely.
"We just began the integration process," he said. "Our priority is no disruption to customers and, as we move forward, we will take appropriate actions to create the synergies that are available to us."
InVivo CEO Reynolds looks to deflect criticism fueling stock slide
Frank Reynolds, CEO of InVivo Therapeutics (OTC:NVIV), which has lost half of its value since August, moved to quell criticism of his management of the company and the "unsubstantiated Internet rumors" Reynolds blames for the slide.
"We are disappointed with our recent stock price performance. The 50% decline since the end of August 2012 is unwarranted and seems to have been driven by unsubstantiated Internet rumors," Reynolds wrote in a letter to shareholders. "We believe our stock is undervalued and has significant near-term catalysts that should drive valuation."
The "Internet rumors" include message board postings and Tweets criticizing Reynolds’ more than $1.1 million pay package, with its base salary of $545,000. The package includes $260,000 in potential performance bonus pay; a 1-time cash bonus of $100,000 "as consideration for Mr. Reynolds’ service as chief financial officer and efforts to find and appoint a new chief financial officer;" $72,000 in living expenses so long as his main residence is outside the Bay State; $20,200 in "other annual fringe benefits;" and $128,423 for "accrued but unused vacation."
Philips, InfraReDx ink integration pact
InfraReDx and Philips (NYSE:PHG) said they inked a joint development and collaboration agreement to integrate InfraReDx’s true vessel characterization imaging system with Philips’ Allura Xper catheterization lab imaging systems.
Steris, NeuroLogica in deal for operating suites
Steris (NYSE:STE) and NeuroLogica agreed to co-develop fully integrated, intraoperative surgical suites with NeuroLogica’s BodyTom full-body portable CT scanner and Steris’ custom-designed high-definition integrated surgical suites.
It’s not the 1st time NeuroLogica has struck a deal with a larger enterprise. The company inked a pact with Medtronic (NYSE:MDT) in July to integrate the BodyTom with Medtronic’s StealthStation surgical navigation system.
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