Stock (Symbol) |
Johnson & Johnson (JNJ) |
Stock Price |
$173 |
Sector |
Healthcare |
Data is as of |
February 2, 2022 |
Expected to Report |
April 19 |
Company Description |
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Sharek’s Take |
![]() Johnson & Johnson and its subsidiaries have approximately 134,500 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the health care field. The Company is organized into three business segments: Consumer Health, Pharmaceutical and Medical Devices. The Consumer Health segment offer products focused on personal healthcare used in the skin health/beauty, over-the-counter medicines, baby care, oral care, women’s health and wound care markets. The Pharmaceutical segment is focused on six therapeutic areas: Immunology, Infectious Diseases, Neuroscience, Oncology, Cardiovascular and Metabolism and Pulmonary Hypertension. Medicines in this segment are distributed directly to retailers, wholesalers, hospitals and health care professionals for prescription use. Finally, The Medical Devices segment includes a broad range of products used in the Interventional Solutions, Orthopaedics, Surgery, and Vision fields. These products are distributed to wholesalers, hospitals and retailers, and used predominantly in the professional fields by physicians, nurses, hospitals, eye care professionals and clinics. Here are more details on J&J’s divisions, including sales growth last qtr:
JNJ is a stable stock that can provide a high level of safety in a portfolio, but this has been a slower-growing stock. The stock usually has an Est. LTG of just 6-7% per year. Right now, the growth rate is 7%. A dividend yield of ~3% pushes the estimated total return to above 10% a year. J&J’s credo has been “Businesses should make a solid profit” and outside of 2020, the company has delivered as profits have increased every year since 1984. Meaning 36 consecutive years of profit growth. The company has a AAA rating from S&P, has increased its dividend every year since 1963. JNJ is a core holding in the Conservative Growth Portfolio. With a reasonable P/E of 16, the stock is a true value in an uncertain stock market. |
One Year Chart |
![]() The P/E is 16 this qtr. It was 18 last qtr. The stock’s a bargain here. The Est. LTG of 7% is down, from 8% 2qtrsAgo and up from 9% 3qtrsAgo. After the split, I’m optimistic that the JNJ side can grow 10% or so a year. |
Earnings Table |
![]() Sales performance was fueled by strong pharmaceutical products like TREMFYA, ERLEADA, and DARZALEX, and strong e-commerce growth, as well as contributions from medical and consumer businesses, during the qtr. Annual Profit Estimates were mixed this qtr. For fiscal 2022, management expects sales to grow around 7% to $100 billion. Qtrly Profit Estimates are for 0%, 6%, 4%, and 17% profit growth the next 4 qtrs. Note the company has tough comparisons from the year-ago periods. |
Fair Value |
![]() This stock has modest upside. |
Bottom Line |
![]() A split for the company should benefit the JNJ stock as that side will have the fastest growing divisions. My guess is after the split takes place I will sell the Consumer Health stock as it might not have the ability to deliver 10% total returns I look for in the Conservative Portfolio.JNJ drops from 20th to 30th in my Conservative Portfolio Power Rankings. This stock is still a slow grower for the next year. Qtrly profit estimates are poor, and the stock is around its highs in a Bear Market. JNJ might not have the institutional support to break out and run higher. |
Power Rankings |
Growth Stock Portfolio
N/AAggressive Growth Portfolio N/AConservative Stock Portfolio 30 of 36 |