JOHNSON & JOHNSON (JNJ)
US4781601046 - Common Stock
JNJ gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 198 industry peers in the Pharmaceuticals industry. JNJ has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. JNJ is not valued too expensively and it also shows a decent growth rate. Finally JNJ also has an excellent dividend rating. This makes JNJ very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
In the past year JNJ was profitable.
In the past year JNJ had a positive cash flow from operations.
Each year in the past 5 years JNJ has been profitable.
Each year in the past 5 years JNJ had a positive operating cash flow.
1.2 Ratios
The Return On Assets of JNJ (20.98%) is better than 97.96% of its industry peers.
JNJ has a better Return On Equity (51.11%) than 97.96% of its industry peers.
JNJ's Return On Invested Capital of 16.76% is amongst the best of the industry. JNJ outperforms 93.88% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for JNJ is in line with the industry average of 16.40%.
The 3 year average ROIC (14.68%) for JNJ is below the current ROIC(16.76%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 20.98% | ||
| ROE | 51.11% | ||
| ROIC | 16.76% |
ROA(3y)14.01%
ROA(5y)12%
ROE(3y)34.23%
ROE(5y)30.27%
ROIC(3y)14.68%
ROIC(5y)14.11%
1.3 Margins
The Profit Margin of JNJ (41.28%) is better than 96.94% of its industry peers.
In the last couple of years the Profit Margin of JNJ has grown nicely.
JNJ's Operating Margin of 28.05% is amongst the best of the industry. JNJ outperforms 93.88% of its industry peers.
JNJ's Operating Margin has improved in the last couple of years.
The Gross Margin of JNJ (69.18%) is better than 72.96% of its industry peers.
In the last couple of years the Gross Margin of JNJ has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.05% | ||
| PM (TTM) | 41.28% | ||
| GM | 69.18% |
OM growth 3Y4.66%
OM growth 5Y2.82%
PM growth 3Y32.32%
PM growth 5Y17.1%
GM growth 3Y1.74%
GM growth 5Y0.67%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), JNJ is creating value.
Compared to 1 year ago, JNJ has less shares outstanding
JNJ has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, JNJ has an improved debt to assets ratio.
2.2 Solvency
JNJ has an Altman-Z score of 4.45. This indicates that JNJ is financially healthy and has little risk of bankruptcy at the moment.
JNJ's Altman-Z score of 4.45 is amongst the best of the industry. JNJ outperforms 81.63% of its industry peers.
The Debt to FCF ratio of JNJ is 1.61, which is an excellent value as it means it would take JNJ, only 1.61 years of fcf income to pay off all of its debts.
JNJ has a better Debt to FCF ratio (1.61) than 94.39% of its industry peers.
JNJ has a Debt/Equity ratio of 0.41. This is a healthy value indicating a solid balance between debt and equity.
JNJ's Debt to Equity ratio of 0.41 is on the low side compared to the rest of the industry. JNJ is outperformed by 61.73% of its industry peers.
Although JNJ does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 1.61 | ||
| Altman-Z | 4.45 |
ROIC/WACC1.82
WACC9.21%
2.3 Liquidity
A Current Ratio of 1.16 indicates that JNJ should not have too much problems paying its short term obligations.
The Current ratio of JNJ (1.16) is worse than 84.18% of its industry peers.
A Quick Ratio of 0.91 indicates that JNJ may have some problems paying its short term obligations.
The Quick ratio of JNJ (0.91) is worse than 82.14% of its industry peers.
The current and quick ratio evaluation for JNJ is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.16 | ||
| Quick Ratio | 0.91 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.66% over the past year.
Measured over the past 5 years, JNJ shows a small growth in Earnings Per Share. The EPS has been growing by 4.98% on average per year.
The Revenue has been growing slightly by 6.46% in the past year.
JNJ shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.86% yearly.
EPS 1Y (TTM)2.66%
EPS 3Y9.11%
EPS 5Y4.98%
EPS growth Q2Q-2.55%
Revenue 1Y (TTM)6.46%
Revenue growth 3Y1.03%
Revenue growth 5Y0.86%
Revenue growth Q2Q7.3%
3.2 Future
JNJ is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 3.98% yearly.
Based on estimates for the next years, JNJ will show a small growth in Revenue. The Revenue will grow by 3.33% on average per year.
EPS Next Y3.1%
EPS Next 2Y3.34%
EPS Next 3Y3.52%
EPS Next 5Y3.98%
Revenue Next Year4.32%
Revenue Next 2Y3.51%
Revenue Next 3Y3.48%
Revenue Next 5Y3.33%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
JNJ is valuated correctly with a Price/Earnings ratio of 14.12.
Based on the Price/Earnings ratio, JNJ is valued cheaply inside the industry as 86.73% of the companies are valued more expensively.
JNJ's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.80.
The Price/Forward Earnings ratio is 13.69, which indicates a correct valuation of JNJ.
JNJ's Price/Forward Earnings ratio is rather cheap when compared to the industry. JNJ is cheaper than 87.24% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of JNJ to the average of the S&P500 Index (21.27), we can say JNJ is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.12 | ||
| Fwd PE | 13.69 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, JNJ is valued cheaper than 84.69% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, JNJ is valued cheaper than 82.14% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.45 | ||
| EV/EBITDA | 10.87 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates JNJ does not grow enough to justify the current Price/Earnings ratio.
JNJ has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)4.56
PEG (5Y)2.84
EPS Next 2Y3.34%
EPS Next 3Y3.52%
5. Dividend
5.1 Amount
JNJ has a Yearly Dividend Yield of 3.43%.
JNJ's Dividend Yield is rather good when compared to the industry average which is at 4.36. JNJ pays more dividend than 93.37% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, JNJ pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.43% |
5.2 History
The dividend of JNJ is nicely growing with an annual growth rate of 9.96%!
JNJ has been paying a dividend for at least 10 years, so it has a reliable track record.
JNJ has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.96%
Div Incr Years19
Div Non Decr Years19
5.3 Sustainability
JNJ pays out 33.48% of its income as dividend. This is a sustainable payout ratio.
JNJ's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP33.48%
EPS Next 2Y3.34%
EPS Next 3Y3.52%
JOHNSON & JOHNSON
NYSE:JNJ (4/19/2024, 1:23:07 PM)
147.26
+1.52 (+1.04%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap354.86B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.43% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
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Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.12 | ||
| Fwd PE | 13.69 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)4.56
PEG (5Y)2.84
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 20.98% | ||
| ROE | 51.11% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 28.05% | ||
| PM (TTM) | 41.28% | ||
| GM | 69.18% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.51
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.16 | ||
| Quick Ratio | 0.91 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)2.66%
EPS 3Y9.11%
EPS 5Y
EPS growth Q2Q
EPS Next Y3.1%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)6.46%
Revenue growth 3Y1.03%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y