Johnson & Johnson (JNJ) AI Stock Analysis

• Market Cap: $363.81B
• Dividend Yield: 3.31%
• Average Volume (3M): 10.41M
• Price to Earnings (P/E): 26.1
• Beta (1Y): 0.33
• Revenue Growth: -4.51%
• EPS Growth: 3.69%
• Country: US
• Employees: 138,100
• Sector: Healthcare
• Sector Strength: 74
• Industry: Drug Manufacturers - General
• EPS (TTM): 5.80
• Shares Outstanding: 2,409,847,700
• 10 Day Avg. Volume: 12,582,437
• 30 Day Avg. Volume: 10,406,771
• PEG Ratio: 7.06
• Price to Book (P/B): N/A
• Price to Sales (P/S): 4.44
• Price to Cash Flow (P/CF): 14.10
• P/FCF Ratio: 14.10
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $169.00
• Price Target Upside: 11.94% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

Johnson & Johnson's strong financial performance and innovative growth are offset by valuation concerns and recent legal setbacks. While the company's robust product pipeline and solid dividend yield are appealing, challenges such as market competition and macroeconomic pressures could weigh on future performance.

Positive Factors

Financial Capacity

The company has the industry's highest balance sheet capacity, which is expected to support future growth and manage potential litigation resolutions.

Growth Projections

Johnson & Johnson recently reaffirmed its projection for 2025-2030 operational sales CAGR of 5-7%.

Innovative Medicines

The company has a strong track record of augmenting revenue growth in the Innovative Medicines business via acquisitions.

Negative Factors

Bankruptcy Dismissal

Johnson & Johnson's Red River talc bankruptcy plan was dismissed by a Texas judge due to a flawed process in soliciting votes from claimants.

Revenue and EPS Growth

Its near- and intermediate-term revenue and EPS growth is only about average relative to big pharma peers.

Talc Litigation

The rejection of JNJ's third bankruptcy proposal increases uncertainty of cost and outcome and likely prolongs the litigation timeline.

Johnson & Johnson Business Overview & Revenue Model

Company Description

Johnson & Johnson is a multinational corporation that operates in the healthcare sector, providing a wide range of products and services across its three primary segments: Consumer Health, Pharmaceutical, and Medical Devices. The company's Consumer Health division offers well-known brands in baby care, skin and hair care, wound care, and over-the-counter pharmaceutical products. Its Pharmaceutical segment focuses on manufacturing and marketing a broad portfolio of medications, targeting areas such as immunology, oncology, neurology, and infectious diseases. The Medical Devices segment provides products used in orthopedic, surgery, vision, and cardiovascular fields. Established in 1886, Johnson & Johnson is headquartered in New Brunswick, New Jersey, and is recognized globally for its commitment to improving health and well-being.

How the Company Makes Money

Johnson & Johnson generates revenue through a diversified model that includes three major segments: Consumer Health, Pharmaceutical, and Medical Devices. The Pharmaceutical segment is the largest contributor to the company's revenue, driven by the development and sale of innovative prescription drugs and treatments in therapeutic areas like oncology, immunology, and infectious diseases. The Medical Devices segment earns revenue by providing surgical equipment, orthopedic products, and vision care products to healthcare professionals and facilities. The Consumer Health segment sells a variety of over-the-counter medications, skincare products, and personal hygiene items directly to consumers through retail and online channels. Johnson & Johnson's earnings are further supported by strategic partnerships and collaborations with research institutions, other pharmaceutical companies, and healthcare providers to enhance its product offerings and expand its market reach.

Johnson & Johnson Financial Statement Overview

Summary

Johnson & Johnson maintains a commendable financial standing, supported by strong profitability, a solid balance sheet, and substantial cash flow. While the income statement indicates some challenges in revenue growth, the overall financial health remains robust due to minimal leverage and efficient cash generation.

Income Statement

Johnson & Johnson demonstrates strong profitability with a solid gross profit margin, driven by consistent revenue generation. However, a recent decline in total revenue suggests potential market challenges. The company's EBIT and EBITDA margins indicate efficient operations but a drop in net income highlights a need for cost control.

Balance Sheet

The balance sheet is robust with a significant portion of equity relative to total assets, suggesting financial stability. Johnson & Johnson exhibits a low debt level, indicative of prudent financial management, which reduces financial risk. The return on equity shows effective use of shareholder funds, despite a slight decrease in stockholder equity.

Cash Flow

The cash flow statement reflects healthy operating cash flows, supporting strong free cash flow generation. However, fluctuations in free cash flow growth and significant capital expenditures warrant attention. The operating cash flow to net income ratio remains strong, showcasing effective cash conversion.

Breakdown
Dec 2024	Dec 2023	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
88.82B	85.16B	79.99B	78.74B	82.58B
	Gross Profit
61.35B	58.61B	55.39B	55.34B	54.16B
	EBIT
22.15B	23.41B	21.01B	20.94B	19.73B
	EBITDA
24.78B	23.32B	26.61B	26.75B	23.93B
	Net Income Common Stockholders
14.07B	35.15B	17.94B	20.88B	14.71B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
24.52B	22.93B	22.28B	31.61B	25.18B
	Total Assets
180.10B	167.56B	187.38B	182.02B	174.89B
	Total Debt
36.63B	29.33B	39.64B	33.75B	35.27B
	Net Debt
12.53B	7.47B	26.75B	19.26B	21.28B
	Total Liabilities
108.61B	98.78B	110.57B	108.00B	111.62B
	Stockholders Equity
71.49B	68.77B	76.80B	74.02B	63.28B
Cash Flow		Free Cash Flow
19.84B	18.25B	17.18B	19.76B	20.19B
	Operating Cash Flow
24.27B	22.79B	21.19B	23.41B	23.54B
	Investing Cash Flow
-18.60B	878.00M	-12.37B	-8.68B	-20.82B
	Financing Cash Flow
-3.13B	-15.82B	-8.87B	-14.05B	-6.12B

Johnson & Johnson Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 150.97
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JNJ, the sentiment is Negative. The current price of 150.97 is below the 20-day moving average (MA) of 159.73, below the 50-day MA of 159.27, and below the 200-day MA of 154.61, indicating a bearish trend. The MACD of 0.27 indicates Positive momentum. The RSI at 34.03 is Neutral, neither overbought nor oversold. The STOCH value of 53.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JNJ.

Johnson & Johnson Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JNJ	75 Outperform	$363.81B	26.07	20.06%	3.31%	-4.51%	3.69%
AMGN	75 Outperform	$156.37B	38.50	67.55%	3.26%	18.64%	-39.39%
AZN	73 Outperform	$192.30B	29.42	17.60%	2.34%	18.03%	18.11%
MRK	71 Outperform	$206.91B	12.16	40.81%	4.00%	6.85%	4577.79%
ABBV	71 Outperform	$318.13B	75.24	61.94%	3.58%	3.71%	-12.14%
PFE	68 Neutral	$127.55B	15.96	9.05%	7.74%	8.77%	272.80%
Sector *	48 Neutral	$6.36B	1.24	-44.94%	2.70%	18.33%	1.47%

Johnson & Johnson Corporate Events

Johnson & Johnson Faces Bankruptcy Plan Rejection

On March 31, 2025, Johnson & Johnson announced that the U.S. Bankruptcy Court for the Southern District of Texas denied the request by its subsidiary, Red River Talc LLC, to confirm its proposed prepackaged bankruptcy plan. As a result, the company will reverse approximately $7 billion from amounts previously reserved for the bankruptcy resolution, impacting its financial planning and potentially affecting stakeholders’ expectations.