Balancing Dividends and Fundamentals: The Case of NYSE:JNJ.

Last update: Apr 25, 2024

Unearth the potential of JOHNSON & JOHNSON (NYSE:JNJ) as a dividend stock recommended by our stock screening tool. NYSE:JNJ maintains a robust financial footing and delivers a sustainable dividend. We'll delve into the details below.

Understanding NYSE:JNJ's Dividend Score

ChartMill assigns a Dividend Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing various dividend elements, such as yield, historical performance, dividend growth, and sustainability. NYSE:JNJ has been awarded a 7 for its dividend quality:

JNJ's Dividend Yield is rather good when compared to the industry average which is at 4.45. JNJ pays more dividend than 93.33% of the companies in the same industry.
JNJ's Dividend Yield is a higher than the S&P500 average which is at 2.45.
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 their dividend for at least 10 years, which is a reliable track record.
33.48% of the earnings are spent on dividend by JNJ. This is a low number and sustainable payout ratio.

What does the Health looks like for NYSE:JNJ

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NYSE:JNJ scores a 8 out of 10:

An Altman-Z score of 4.49 indicates that JNJ is not in any danger for bankruptcy at the moment.
JNJ has a Altman-Z score of 4.49. This is amongst the best in the industry. JNJ outperforms 82.05% 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.
Looking at the Debt to FCF ratio, with a value of 1.61, JNJ belongs to the top of the industry, outperforming 94.36% of the companies in the same industry.
A Debt/Equity ratio of 0.41 indicates that JNJ is not too dependend on debt financing.
Even though the debt/equity ratio score it not favorable for JNJ, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
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.

Exploring NYSE:JNJ's Profitability

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:JNJ was assigned a score of 9 for profitability:

Looking at the Return On Assets, with a value of 20.98%, JNJ belongs to the top of the industry, outperforming 97.95% of the companies in the same industry.
JNJ has a Return On Equity of 51.11%. This is amongst the best in the industry. JNJ outperforms 97.95% of its industry peers.
With an excellent Return On Invested Capital value of 16.76%, JNJ belongs to the best of the industry, outperforming 93.85% of the companies in the same industry.
The 3 year average ROIC (14.68%) for JNJ is below the current ROIC(16.76%), indicating increased profibility in the last year.
With an excellent Profit Margin value of 41.28%, JNJ belongs to the best of the industry, outperforming 96.92% of the companies in the same industry.
JNJ's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 28.05%, JNJ belongs to the top of the industry, outperforming 93.85% of the companies in the same industry.
In the last couple of years the Operating Margin of JNJ has grown nicely.
The Gross Margin of JNJ (69.18%) is better than 72.82% of its industry peers.

Our Best Dividend screener lists more Best Dividend stocks and is updated daily.

Our latest full fundamental report of JNJ contains the most current fundamental analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.