Johnson & Johnson is the world's largest and most diverse healthcare firm. It has two divisions: pharmaceutical and medical devices. These now represent all of the company's sales following the divestment of the consumer business, Kenvue, in 2023. The drug division focuses on the following therapeutic areas: immunology, oncology, neurology, pulmonary, cardiology, and metabolic diseases. Geographically, just over half of total revenue is generated in the United States.

Goldman Sachs is a leading global investment banking and asset management firm. Approximately 14% of its revenue comes from investment banking, 42% from trading, 20% from asset & wealth management, 15% from net interest income, and 9% from other principal transactions. Around 64% of the company's net revenue is generated in the Americas, 13% in Asia, and 23% in Europe, the Middle East, and Africa.

Morgan Stanley is a global investment bank whose history, through its legacy firms, can be traced back to 1924. The company has institutional securities, wealth management, and investment management segments with approximately 45% of net revenue from its institutional securities business, 45% from wealth management, and 10% from investment management. About 24% of its total revenue is from outside the Americas. The company had over $6 trillion of client assets as well as around 70,000 employees at the end of 2024.

The 1Q25 EPS season is under way, launched, as usual by the earnings reports from the big banks. Next week, the floodgates will open with Consumer, Healthcare, and Industrial companies all releasing their quarterly results. Information Technology and Energy companies generally report later in the EPS period, and then the retailers wrap things up by late May. Consensus EPS estimates for 1Q25 growth range from low-single-digits to high-single-digits. This follows 17% growth in 4Q24 EPS and 9% growth in 3Q24, according to LSEG I/B/E/S. Leading sectors for 1Q25 are expected to be Healthcare (+38% EPS growth year over year) and Information Technology (+16%). Growth from the so-called Magnificent 7 is expected to outpace overall growth, as the group's earnings are forecast to grow 18%. On the downside, earnings from the Energy sector are expected to decline 15% and Materials 7%. Drilling down, revenue is expected to increase 4%, led by IT (+11%) and Healthcare (+4%). The balance of earnings growth will come from margin improvement and share buybacks. For 2025, our full-year earnings estimate is $276, implying low double-digit growth from 2024 level. Remember, companies generally exceed earnings expectations. Last quarter, three quarters of companies exceeded consensus expectations, compared to the historical average of 67%. Some complain that the U.S. SEC, by forcing companies to report quarterly profits, places too much emphasis on short-term results. But the system generates the most-transparent market in the world, as companies not only report results, but management teams also discuss those results and the outlook ahead. That's important today, when there is so much uncertainty over the direction of the global economy.