Johnson & Johnson (JNJ)
On Monday, an Oklahoma judge ruled against the pharma and consumer goods giant in the state’s highly publicized opioid case. The ruling marks the first major opioid crisis-related U.S. penalty against a major drug producer and will force the firm to pay a fine of $572 million, only about 1% of the company’s total $54.6 billion in profit reported last year. The judge called the opioid crisis an “imminent danger and menace” that was fueled in part by Johnson & Johnson’s “misleading marketing and promotion of opioids.”
Investors responded by boosting shares of JNJ by 1.2% in premarket hours to $129.40. The stock is in dire need of a rebound, as it’s down more than 10% over just the last two months alone. Shares have still managed to eke out a 0.3% gain on the year since closing at $129.05 on Dec. 31.
The J.M. Smucker Co. (SJM)
J.M. Smucker — which primarily manufactures food products like peanut butter, jam, and various beverages — saw its stock nosedive early on Tuesday after releasing quarterly earnings that missed Wall Street estimates. Smucker said fiscal Q1 sales declined 6% year-over-year to $1.78 billion, missing analysts’ $1.87 billion estimate by 4.8%. The company blamed falling coffee and peanut butter prices for the weak financials, saying its declining pricing power for coffee and peanut butter brands like Folgers and Jif, respectively, hurt comparable sales by 4%.
Shares of SJM tumbled as much as 5.7% to $106.50 on the news early Tuesday morning. If the stock closed at that price, it would be the worst settlement since March 15 when shares ended the session at $105.58. At $106.50, the stock boasts a year-to-date gain of 13.9% from the Dec. 31 close of $93.49.
Papa John’s International Inc. (PZZA)
Shares of the national pizza chain — which boasts over 5,300 locations in the U.S. — were making moves after the company announced former Arby’s president Rob Lynch would replace Steve Ritchie as CEO. The announcement was embraced by investors as a big leap forward for the chain’s turnaround plans, as Lynch helped lead Arby’s to 16 consecutive quarters of same-store sales growth and record profits in 2018. Starboard Value, the activist hedge fund that took majority control of Papa John’s earlier this year, said Lynch’s “proven record transforming organizations and realizing the growth potential of differentiated brands is ideally suited for Papa John’s as the company sets forth on its next chapter.”
The stock jumped as much as 7% in premarket trading Tuesday, reaching upwards of $46.70 per share. PZZA has struggled to regain the year-to-date high of $53.48 witnessed earlier this summer, but shares still maintain a 2019 return of 17.3% from the $39.81 settlement seen on Dec. 31.
