Johnson & Johnson (JNJ) AI Stock Analysis

• Market Cap: $509.76B
• Dividend Yield: 2.43%
• Average Volume (3M): 8.64M
• Price to Earnings (P/E): 20.4
• Beta (1Y): 0.11
• Revenue Growth: 5.08%
• EPS Growth: 71.07%
• Country: US
• Employees: 138,100
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - General
• EPS (TTM): 2.80
• Shares Outstanding: 2,409,295,200
• 10 Day Avg. Volume: 8,489,262
• 30 Day Avg. Volume: 8,637,826
• PEG Ratio: -0.42
• Price to Book (P/B): 4.83
• Price to Sales (P/S): 3.88
• P/FCF Ratio: 17.39
• Enterprise Value/Market Cap: 0.91
• Enterprise Value/Revenue: 5.03
• Enterprise Value/Gross Profit: 7.39
• Enterprise Value/Ebitda: 11.72
• 1Y Price Target: $213.50
• Price Target Upside: 0.91% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 20
• EPS Forecast (FY): 10.87
• Revenue Forecast (FY): $93.75B

• Rating: 78 Outperform
• Price Target: $230.00 ▲(8.71% Upside)

Johnson & Johnson's overall stock score reflects its strong financial performance and positive earnings call, which highlight robust growth and strategic initiatives. While the technical analysis indicates a bullish trend, the valuation is less compelling. Corporate events further support the company's strategic direction.

Positive Factors

Strong Product Pipeline

The approval and growth of new products like Inlexo and CARVICTI highlight J&J's robust pipeline, ensuring long-term revenue growth and market leadership in innovative treatments.

Global Market Expansion

Entry into China's drug catalog expands J&J's market reach, providing access to a large consumer base and supporting sustained revenue growth in a key international market.

Operational Sales Growth

Consistent operational sales growth across key segments indicates effective business strategies and strong market demand, supporting long-term financial stability.

Negative Factors

Loss of Exclusivity

The loss of exclusivity for STELARA poses a significant challenge, potentially impacting revenue and necessitating strategic adjustments to mitigate competitive pressures.

Increased Tax Rate

A higher effective tax rate reduces net earnings and could constrain financial resources available for reinvestment, affecting long-term profitability.

Debt Levels

Rising debt levels could limit financial flexibility and increase risk, potentially impacting J&J's ability to invest in growth opportunities and maintain its competitive edge.

Johnson & Johnson Business Overview & Revenue Model

Company Description

Johnson & Johnson, together with its subsidiaries, researches and develops, manufactures, and sells various products in the healthcare field worldwide, but strategically separated its Consumer Health business into Kenvue Inc. in 2023 to focus on its higher-growth, innovation-driven segments; the former Consumer Health brands (including TYLENOL, LISTERINE, and BAND-AID) are now owned by Kenvue. The company's core focus is now split between its Innovative Medicine (formerly Pharmaceutical) segment, which offers prescription products for complex diseases such as rheumatoid arthritis, various cancers, HIV/AIDS, and neurodegenerative disorders; and its MedTech (Medical Devices) segment, which provides advanced technology solutions including electrophysiology products, neurovascular care products, orthopaedics (hips, knees, spine), advanced surgery solutions, and disposable contact lenses under the ACUVUE brand. Company's two remaining segments primarily serve hospitals, healthcare professionals, wholesalers, and retailers, continuing its mission of advancing human health since its founding in 1886 and its current basing in New Brunswick, New Jersey.

How the Company Makes Money

Johnson & Johnson generates revenue through a diversified business model that encompasses three primary segments: Pharmaceuticals, Medical Devices, and Consumer Health. The Pharmaceutical segment, which contributes a substantial portion of revenue, includes products for immunology, oncology, neuroscience, and infectious diseases, among others. The Medical Devices segment includes a wide range of surgical instruments, orthopedics, and interventional solutions, while the Consumer Health segment features well-known brands such as Tylenol, Band-Aid, and Neutrogena. Key revenue streams include direct sales to healthcare providers, hospitals, and consumers, as well as partnerships and collaborations with other healthcare organizations for research and development. The company also benefits from a strong global distribution network and strategic acquisitions that enhance its product offerings and market reach. Factors such as ongoing innovation, regulatory approvals for new drugs, and the expansion of existing product lines significantly contribute to Johnson & Johnson's earnings.

Johnson & Johnson Financial Statement Overview

Summary

Johnson & Johnson exhibits strong financial health with robust profitability, a solid balance sheet, and efficient cash flow management. The company shows consistent revenue growth and effective use of equity, although the increase in debt and slight decline in net profit margin warrant attention.

Income Statement

Johnson & Johnson's income statement shows strong profitability with a high gross profit margin of 68.08% and a net profit margin of 27.26% for the TTM. The company has maintained steady revenue growth, with a 2.24% increase in the TTM. EBIT and EBITDA margins are robust at 34.91% and 40.00%, respectively, indicating efficient operations. However, the net profit margin has decreased from previous years, which could be a concern if the trend continues.

Balance Sheet

The balance sheet reflects a solid financial position with a manageable debt-to-equity ratio of 0.65. The return on equity is impressive at 33.69%, showcasing effective use of shareholder funds. The equity ratio stands at 41.11%, indicating a stable capital structure. However, the increase in total debt over the years requires monitoring to ensure it does not impact financial flexibility.

Cash Flow

Cash flow analysis reveals a healthy free cash flow growth rate of 23.07% in the TTM, demonstrating strong cash generation capabilities. The operating cash flow to net income ratio is 0.43, and the free cash flow to net income ratio is 0.71, indicating efficient cash conversion. Despite the positive cash flow metrics, the decline in operating cash flow coverage ratio compared to previous years suggests potential areas for improvement in cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	92.15B	88.82B	85.16B	79.99B	78.74B	82.58B
Gross Profit	62.73B	61.35B	58.61B	55.39B	55.34B	54.16B
EBITDA	39.56B	24.78B	23.32B	26.61B	26.75B	23.93B
Net Income	25.12B	14.07B	35.15B	17.94B	20.88B	14.71B
Balance Sheet
Total Assets	192.82B	180.10B	167.56B	187.38B	182.02B	174.89B
Cash, Cash Equivalents and Short-Term Investments	18.56B	24.52B	22.93B	22.28B	31.61B	25.18B
Total Debt	6.39B	37.83B	29.33B	39.64B	33.75B	35.27B
Total Liabilities	113.54B	108.61B	98.78B	110.57B	108.00B	111.62B
Stockholders Equity	79.28B	71.49B	68.77B	76.80B	74.02B	63.28B
Cash Flow
Free Cash Flow	19.06B	19.84B	18.25B	17.18B	19.76B	20.19B
Operating Cash Flow	24.20B	24.27B	22.79B	21.19B	23.41B	23.54B
Investing Cash Flow	-20.42B	-18.60B	878.00M	-12.37B	-8.68B	-20.82B
Financing Cash Flow	-5.51B	-3.13B	-15.82B	-8.87B	-14.05B	-6.12B

Johnson & Johnson Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 211.58
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JNJ, the sentiment is Positive. The current price of 211.58 is above the 20-day moving average (MA) of 203.67, above the 50-day MA of 194.81, and above the 200-day MA of 169.22, indicating a bullish trend. The MACD of 4.03 indicates Negative momentum. The RSI at 73.97 is Negative, neither overbought nor oversold. The STOCH value of 89.58 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JNJ.

Johnson & Johnson Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MRK	80 Outperform	$248.95B	13.27	39.51%	3.23%	1.59%	58.02%
NVS	80 Outperform	$252.25B	17.95	32.93%	3.01%	11.53%	-15.21%
AZN	79 Outperform	$278.70B	29.60	21.73%	1.74%	12.95%	44.28%
JNJ	78 Outperform	$509.76B	20.42	33.62%	2.43%	5.08%	71.07%
SNY	75 Outperform	$120.76B	12.32	8.39%	4.54%	-9.32%	120.62%
ABBV	66 Neutral	$394.69B	168.51	138.53%	2.94%	7.40%	-53.78%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Johnson & Johnson Corporate Events

Johnson & Johnson Reports Strong Q3 2025 Financial Results

On October 14, 2025, Johnson & Johnson announced its third-quarter 2025 financial results, reporting a 6.8% increase in sales to $24 billion and a significant rise in net earnings by 91.2%. The company also raised its full-year sales outlook to $93.7 billion, driven by strong performance in its Innovative Medicine and MedTech segments. Key developments included approvals for new treatments and significant progress in its product pipeline, indicating a strategic focus on innovation and growth in priority areas. The announcement highlights the company’s robust financial health and its strategic initiatives aimed at maintaining its leadership position in the healthcare sector.

Johnson & Johnson Elects John Morikis to Board

On September 8, 2025, Johnson & Johnson announced the election of John Morikis, former Executive Chairman, President, and CEO of The Sherwin-Williams Company, to its Board of Directors. Morikis, recognized for his leadership in global markets and supply chains, will contribute to Johnson & Johnson’s long-term strategy of healthcare innovation and shareholder value creation.