Morgan Stanley Sees Meaningful '15 Headwind For Johnson & Johnson

In a report published Wednesday, Morgan Stanley analyst David R. Lewis reiterated an Equal-Weight rating on

. In the report, Morgan Stanley noted, “Underlying trends are solid, but Olysio presents a meaningful '15 headwind. Olysio is offsetting the OCD headwind in 2014 by a factor of two, but could represent a ~$0.27 (4.5%) EPS and 3% growth headwind in '15 as Gilead enters the market, likely in 4Q14. Increased buybacks with OCD proceeds ($0.05) will help the bottom line, but there will still be a >$2.5bn sales gap to fill between Olysio and OCD. Excluding the headwinds, the underlying business should improve in '15, with 200 bps of acceleration in Devices and stable growth in Consumer and Pharma, driving 5.5% ex. Olysio growth.” Johnson & Johnson closed on Tuesday at $103.28.