Breakthrough! Wall Street is bullish on Johnson & Johnson (JNJ.US) as the market value surpasses $500 billion for the first time.

On Wednesday, Johnson & Johnson (JNJ.US) reached a market value of 500 billion US dollars. Investors continue to have confidence in the company's strategy to combat declining sales of its key psoriasis treatment drug. On Wednesday, the pharmaceutical and medical device manufacturer's stock rose by 0.4%, reaching 207.56 US dollars, closing above 500 billion US dollars for the first time. The stock has risen for 13 consecutive trading days, marking the longest streak of gains in Johnson & Johnson's history. As of November, the stock has risen by 9.9%, potentially achieving its best single-month performance since April 2020. Wall Street is increasingly optimistic about the company's plan to fill the revenue gap after the expiration of the patent for its popular psoriasis treatment drug Stelara. Johnson & Johnson is hoping for new drugs and acquisitions to supplement its product line and offset the loss from declining Stelara sales. Analysts point out that Johnson & Johnson is considered very stable, has consistently maintained a conservative strategy, and has consistently exceeded expectations in performance, resulting in relatively lower risks compared to many peers. Earlier this year, Johnson & Johnson acquired the neuroscience drug developer Intra-Cellular Therapies Inc. for about 14.6 billion US dollars, gaining a new drug for treating severe depression. Last week, the company agreed to acquire the cancer treatment biotechnology company Halda Therapeutics for over 3 billion US dollars. The company recently raised its full-year sales forecast and announced plans to separate its slow-growing orthopedic business from its overall operations within 18 to 24 months. The company's stock has risen by 44% this year, potentially achieving its best annual performance since 1995, after experiencing consecutive declines in 2023 and 2024. However, Wall Street does not expect much upside in the company's stock price from this point on. The market generally estimates the stock price for Johnson & Johnson in the next 12 months to be around 205 US dollars, slightly lower than Wednesday's closing price. However, over half of the 30 analysts tracked by institutions still rate the company's stock as "buy." On November 12th, Scotiabank analyst Louise Chen wrote in a report to clients, "Outstanding execution is making the company's fundamental growth trend more apparent." She gave Johnson & Johnson the highest target price and listed it as a "top pick." Johnson & Johnson's strength lies in investors gradually shifting funds from high-risk areas of the US stock market to more defensive sectors, while moving away from high-priced artificial intelligence stocks. This month, the healthcare sector of the S&P 500 index rose by 9.7%, marking the largest single-month increase in the sector since April 2020; and the pharmaceutical sector of the S&P 500 index has also risen by about 17% so far in November, potentially achieving its best single-month performance ever. Chief Options Analyst Bob Lang of Explosive Options stated, "Over the past three and a half weeks, we have seen a shift in investors' investment preferences, first moving from high-risk investments to the technology sector, and then from the technology sector to the healthcare sector. I believe this actually reflects investors seeking more security in some healthcare stocks." The pharmaceutical sector has mainly benefited from Eli Lilly and Company (LLY.US), whose stock has risen by 43% this year and became the first pharmaceutical company to reach a market value of 1 trillion US dollars last week. Merck & Co., Inc. (MRK.US) has also reached historic highs in its stock price, as investors are encouraged by its recent acquisitions and successful clinical trial performances.