Johnson & Johnson's JNJ medical devices segment, known as MedTech, offers products in the orthopedics, surgery, cardiovascular and vision markets. The MedTech segment accounts for around 36% of J&J’s total revenues. In MedTech, J&J is a global leader in electrophysiology, circulatory restoration and heart recovery.
The MedTech segment delivered a mixed performance in the second quarter of 2026, with growth remaining positive but below the pace seen in its Innovative Medicine business. Sales were hurt by weaker sales in Cardiovascular, as competitive pressure in electrophysiology and lower Abiomed sales offset continued double-digit growth at Shockwave. Abiomed sales declined in the second quarter due to slow procedural volumes for the Impella heart pump franchise.
On its third-quarter conference call, investors will await information on whether sales in the MedTech segment improved from the first-quarter slowdown. Here’s what we expect.
J&J expects only modest Abiomed growth in the second half of 2026. While J&J’s Cardiovascular sales may continue to be slow in the third quarter due to weakness in Abiomed, its other three businesses, Surgery, Vision and Orthopedics, are likely to have continued to accelerate in the third quarter. While Abiomed procedures slowed, J&J claimed that overall procedure volumes were stable in the second quarter and there was no broad-based slowdown in medical procedure volumes across its MedTech business. An update on procedure trends in the third quarter is expected on the conference call.
The company continues to face headwinds in China from the government's volume-based procurement (VBP) program, with these pressures expected to continue in the second half. Competitive pressures are also expected to continue to hurt sales growth in some MedTech businesses in the third quarter.
Overall, the MedTech business is expected to perform better in the second half of the year than it did in the first half, driven by strength in Vision, Orthopedics, Surgery and better performance in Cardiovascular. The Zacks Consensus Estimate for J&J’s MedTech segment stands at $8.78 billion.
J&J’s Key Competitors in the Medical Devices Market
J&J’s MedTech unit faces strong competition from several major players in the medical device industry, such as Medtronic MDT, Abbott, Stryker SYK and Boston Scientific BSX.
While Medtronic has a strong presence in cardiovascular, neuroscience and surgical technologies, Stryker is a major player in orthopedics and surgical equipment. Boston Scientific markets products for cardiovascular, endoscopy, urology and neuromodulation. Abbott is known for its medical devices across cardiovascular, diagnostics and diabetes care.
JNJ’s Price Performance, Valuation and Estimates
J&J’s shares have outperformed the industry so far this year. The stock has risen 22.2% this year compared with 9.4% appreciation of the industry.
From a valuation standpoint, J&J is slightly expensive. Going by the price/earnings ratio, the company’s shares currently trade at 20.43 forward earnings, higher than 17.60 for the industry. The stock is also trading above its five-year mean of 15.65.
The Zacks Consensus Estimate for 2026 earnings has declined from $11.59 to $11.54 over the past 60 days, while that for 2027 earnings has declined from $12.80 per share to $12.64 over the same time frame.
J&J has a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).