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Johnson & Johnson on Tuesday said it could no longer provide a forecast for sales of its COVID-19 vaccine, as vaccine hesitancy in low-income countries paired with already low demand in higher-income nations has led to a glut of supply.
The company had earlier predicted as much as $3.5 billion in 2022 sales from the single-dose vaccine, once touted as an important tool for vaccinating hard-to-reach areas.
J&J also cut both ends of its full-year profit forecast by 25 cents and now expects to earn $10.15 to $10.35 per share. But it blamed the move on currency fluctuations rather than fundamental business issues and raised its dividend 6.6%, and shares rose about 4%.
MODERNA SAYS DUAL VARIANT BOOSTER PROVIDES BETTER PROTECTION
"With the guidance cut driven exclusively by currency, I think shares are reacting to the forward looking comments," said Edward Jones analyst Ashtyn Evans. "J&J discussed accelerating growth in medical technology through acquisitions and also the belief that supply chain issues will improve in the second half of the year."
|JNJ||JOHNSON & JOHNSON||177.66||-2.24||-1.25%|
Other analysts said J&J remains a safe bet within the healthcare sector and that raising the dividend provided predictable income for investors despite vaccine sales woes.
The J&J shot has been hurt by links to rare but potentially deadly blood clots, manufacturing issues and concerns about efficacy. It accounts for about 3% of all doses administered in the United States, and roughly 2% of doses in Europe.