JOHNSON & JOHNSON (JNJ) Stock Fundamental Analysis
NYSE:JNJ - New York Stock Exchange, Inc. - US4781601046 - Common Stock - Currency: USD
JNJ gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 198 industry peers in the Pharmaceuticals industry. While JNJ has a great profitability rating, there are some minor concerns on its financial health. JNJ is not valued too expensively and it also shows a decent growth rate. Finally JNJ also has an excellent dividend rating. These ratings could make JNJ a good candidate for dividend investing.
1. Profitability
1.1 Basic Checks
JNJ had positive earnings in the past year.
JNJ had a positive operating cash flow in the past year.
In the past 5 years JNJ has always been profitable.
Each year in the past 5 years JNJ had a positive operating cash flow.
1.2 Ratios
JNJ has a better Return On Assets (11.26%) than 92.93% of its industry peers.
The Return On Equity of JNJ (27.92%) is better than 94.95% of its industry peers.
With an excellent Return On Invested Capital value of 13.67%, JNJ belongs to the best of the industry, outperforming 89.90% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for JNJ is significantly below the industry average of 42.34%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.26% | ||
| ROE | 27.92% | ||
| ROIC | 13.67% |
ROA(3y)12.79%
ROA(5y)11.65%
ROE(3y)31.38%
ROE(5y)29.12%
ROIC(3y)15.41%
ROIC(5y)14.48%
1.3 Margins
JNJ's Profit Margin of 24.41% is amongst the best of the industry. JNJ outperforms 95.45% of its industry peers.
JNJ's Profit Margin has declined in the last couple of years.
The Operating Margin of JNJ (26.16%) is better than 90.91% of its industry peers.
JNJ's Operating Margin has improved in the last couple of years.
JNJ's Gross Margin of 68.34% is fine compared to the rest of the industry. JNJ outperforms 74.75% 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 | 26.16% | ||
| PM (TTM) | 24.41% | ||
| GM | 68.34% |
OM growth 3Y0.33%
OM growth 5Y3.14%
PM growth 3Y-15.79%
PM growth 5Y-2.98%
GM growth 3Y-0.56%
GM growth 5Y0.76%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so JNJ is still creating some value.
JNJ has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, JNJ has less shares outstanding
JNJ has a worse debt/assets ratio than last year.
2.2 Solvency
JNJ has an Altman-Z score of 4.05. This indicates that JNJ is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.05, JNJ is in the better half of the industry, outperforming 79.29% of the companies in the same industry.
JNJ has a debt to FCF ratio of 2.57. This is a good value and a sign of high solvency as JNJ would need 2.57 years to pay back of all of its debts.
JNJ has a Debt to FCF ratio of 2.57. This is amongst the best in the industry. JNJ outperforms 91.92% of its industry peers.
JNJ has a Debt/Equity ratio of 0.63. This is a neutral value indicating JNJ is somewhat dependend on debt financing.
JNJ has a Debt to Equity ratio of 0.63. This is in the lower half of the industry: JNJ underperforms 64.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 2.57 | ||
| Altman-Z | 4.05 |
ROIC/WACC1.33
WACC10.26%
2.3 Liquidity
A Current Ratio of 1.26 indicates that JNJ should not have too much problems paying its short term obligations.
JNJ's Current ratio of 1.26 is on the low side compared to the rest of the industry. JNJ is outperformed by 77.78% of its industry peers.
JNJ has a Quick Ratio of 1.03. This is a normal value and indicates that JNJ is financially healthy and should not expect problems in meeting its short term obligations.
JNJ has a worse Quick ratio (1.03) than 74.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.26 | ||
| Quick Ratio | 1.03 |
3. Growth
3.1 Past
JNJ shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -3.92%.
Measured over the past 5 years, JNJ shows a small growth in Earnings Per Share. The EPS has been growing by 2.85% on average per year.
JNJ shows a small growth in Revenue. In the last year, the Revenue has grown by 4.30%.
Measured over the past years, JNJ shows a small growth in Revenue. The Revenue has been growing by 1.60% on average per year.
EPS 1Y (TTM)-3.92%
EPS 3Y0.64%
EPS 5Y2.85%
EPS Q2Q%2.21%
Revenue 1Y (TTM)4.3%
Revenue growth 3Y4.1%
Revenue growth 5Y1.6%
Sales Q2Q%2.39%
3.2 Future
JNJ is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.39% yearly.
JNJ is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.54% yearly.
EPS Next Y7.29%
EPS Next 2Y6.02%
EPS Next 3Y6.39%
EPS Next 5Y5.39%
Revenue Next Year2.89%
Revenue Next 2Y3.52%
Revenue Next 3Y3.79%
Revenue Next 5Y3.54%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
JNJ is valuated correctly with a Price/Earnings ratio of 15.27.
JNJ's Price/Earnings ratio is rather cheap when compared to the industry. JNJ is cheaper than 86.36% of the companies in the same industry.
JNJ is valuated rather cheaply when we compare the Price/Earnings ratio to 26.60, which is the current average of the S&P500 Index.
JNJ is valuated correctly with a Price/Forward Earnings ratio of 13.67.
Based on the Price/Forward Earnings ratio, JNJ is valued cheaply inside the industry as 81.82% of the companies are valued more expensively.
JNJ's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.43.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.27 | ||
| Fwd PE | 13.67 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, JNJ is valued cheaply inside the industry as 82.83% of the companies are valued more expensively.
JNJ's Price/Free Cash Flow ratio is rather cheap when compared to the industry. JNJ is cheaper than 84.85% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.13 | ||
| EV/EBITDA | 11.62 |
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 a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.1
PEG (5Y)5.36
EPS Next 2Y6.02%
EPS Next 3Y6.39%
5. Dividend
5.1 Amount
JNJ has a Yearly Dividend Yield of 3.48%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 4.24, JNJ pays a better dividend. On top of this JNJ pays more dividend than 93.94% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, JNJ pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.48% |
5.2 History
The dividend of JNJ is nicely growing with an annual growth rate of 9.24%!
JNJ has paid a dividend for at least 10 years, which is 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)9.24%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
JNJ pays out 54.76% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of JNJ is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP54.76%
EPS Next 2Y6.02%
EPS Next 3Y6.39%
NYSE:JNJ (5/21/2025, 9:59:10 AM)
153.47
-0.19 (-0.12%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners73.73%
Inst Owner Change0.48%
Ins Owners0.04%
Ins Owner Change-0.11%
Market Cap369.26B
Analysts74
Price Target174.19 (13.5%)
Short Float %0.82%
Short Ratio2.04
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.48% |
Yearly Dividend4.91
Dividend Growth(5Y)9.24%
DP54.76%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.32%
Min EPS beat(2)0.68%
Max EPS beat(2)5.96%
EPS beat(4)4
Avg EPS beat(4)4.57%
Min EPS beat(4)0.68%
Max EPS beat(4)8.28%
EPS beat(8)7
Avg EPS beat(8)3.76%
EPS beat(12)11
Avg EPS beat(12)3.64%
EPS beat(16)14
Avg EPS beat(16)4.01%
Revenue beat(2)1
Avg Revenue beat(2)-0.01%
Min Revenue beat(2)-0.55%
Max Revenue beat(2)0.53%
Revenue beat(4)2
Avg Revenue beat(4)0%
Min Revenue beat(4)-0.55%
Max Revenue beat(4)0.53%
Revenue beat(8)5
Avg Revenue beat(8)0.36%
Revenue beat(12)5
Avg Revenue beat(12)-6.08%
Revenue beat(16)6
Avg Revenue beat(16)-8.44%
PT rev (1m)0.69%
PT rev (3m)0.5%
EPS NQ rev (1m)0.86%
EPS NQ rev (3m)-1.68%
EPS NY rev (1m)0.55%
EPS NY rev (3m)0.44%
Revenue NQ rev (1m)0.05%
Revenue NQ rev (3m)1.78%
Revenue NY rev (1m)0.63%
Revenue NY rev (3m)1.71%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.27 | ||
| Fwd PE | 13.67 | ||
| P/S | 4.13 | ||
| P/FCF | 18.13 | ||
| P/OCF | 14.9 | ||
| P/B | 4.73 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.62 |
EPS(TTM)10.05
EY6.55%
EPS(NY)11.23
Fwd EY7.32%
FCF(TTM)8.47
FCFY5.52%
OCF(TTM)10.3
OCFY6.71%
SpS37.13
BVpS32.46
TBVpS-1.29
PEG (NY)2.1
PEG (5Y)5.36
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.26% | ||
| ROE | 27.92% | ||
| ROCE | 17.09% | ||
| ROIC | 13.67% | ||
| ROICexc | 18.54% | ||
| ROICexgc | 72.98% | ||
| OM | 26.16% | ||
| PM (TTM) | 24.41% | ||
| GM | 68.34% | ||
| FCFM | 22.8% |
ROA(3y)12.79%
ROA(5y)11.65%
ROE(3y)31.38%
ROE(5y)29.12%
ROIC(3y)15.41%
ROIC(5y)14.48%
ROICexc(3y)18.76%
ROICexc(5y)17.88%
ROICexgc(3y)74.12%
ROICexgc(5y)78.04%
ROCE(3y)18.6%
ROCE(5y)17.28%
ROICexcg growth 3Y1.2%
ROICexcg growth 5Y-0.66%
ROICexc growth 3Y3.58%
ROICexc growth 5Y3.41%
OM growth 3Y0.33%
OM growth 5Y3.14%
PM growth 3Y-15.79%
PM growth 5Y-2.98%
GM growth 3Y-0.56%
GM growth 5Y0.76%
F-Score5
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 2.57 | ||
| Debt/EBITDA | 1.61 | ||
| Cap/Depr | 60.47% | ||
| Cap/Sales | 4.94% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.81% | ||
| Profit Quality | 93.4% | ||
| Current Ratio | 1.26 | ||
| Quick Ratio | 1.03 | ||
| Altman-Z | 4.05 |
F-Score5
WACC10.26%
ROIC/WACC1.33
Cap/Depr(3y)59.5%
Cap/Depr(5y)54.84%
Cap/Sales(3y)5.11%
Cap/Sales(5y)4.8%
Profit Quality(3y)96.25%
Profit Quality(5y)104.12%
High Growth Momentum
Growth
EPS 1Y (TTM)-3.92%
EPS 3Y0.64%
EPS 5Y2.85%
EPS Q2Q%2.21%
EPS Next Y7.29%
EPS Next 2Y6.02%
EPS Next 3Y6.39%
EPS Next 5Y5.39%
Revenue 1Y (TTM)4.3%
Revenue growth 3Y4.1%
Revenue growth 5Y1.6%
Sales Q2Q%2.39%
Revenue Next Year2.89%
Revenue Next 2Y3.52%
Revenue Next 3Y3.79%
Revenue Next 5Y3.54%
EBIT growth 1Y-3.64%
EBIT growth 3Y4.44%
EBIT growth 5Y4.79%
EBIT Next Year20.06%
EBIT Next 3Y12.36%
EBIT Next 5Y7.4%
FCF growth 1Y25.69%
FCF growth 3Y0.14%
FCF growth 5Y-0.08%
OCF growth 1Y21.06%
OCF growth 3Y1.2%
OCF growth 5Y0.72%