, Columnist
Johnson & Johnson's Unstylish Sprawl Looks Good
Its diversity has made it a relatively safe haven in a turbulent market.
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Conglomerates are out of style -- particularly in health care, which has seen a decade of spinoffs, sales, and asset swaps aimed at greater focus. Johnson & Johnson has bucked that trend, even as some of its units have struggled. But sometimes being out of step is the right move.
The company on Tuesday reported second-quarter earnings that topped Wall Street forecasts and boosted revenue guidance for the year, thanks to its pharmaceutical division, which grew sales 8.9 percent from a year ago. In contrast, the company's consumer-products sales declined 1.8 percent, and sales of medical devices grew just 0.8 percent. Those businesses have been laggards for a while, and investors have called for J&J to break up or sell those units.