JOHNSON & JOHNSON (JNJ.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:JNJ - US4781601046 - Common Stock
187.66 EUR
+1.48 (+0.79%)
Taking everything into account, JNJ scores 5 out of 10 in our fundamental rating. JNJ was compared to 55 industry peers in the Pharmaceuticals industry. While JNJ has a great profitability rating, there are some minor concerns on its financial health. JNJ is valied quite expensively at the moment, while it does show a decent growth rate.
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.
- JNJ had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
- JNJ has a better Return On Assets (13.03%) than 81.82% of its industry peers.
- JNJ has a better Return On Equity (31.69%) than 72.73% of its industry peers.
- With a decent Return On Invested Capital value of 14.16%, JNJ is doing good in the industry, outperforming 69.09% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.03% | ||
| ROE | 31.69% | ||
| ROIC | 14.16% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- With an excellent Profit Margin value of 27.26%, JNJ belongs to the best of the industry, outperforming 87.27% of the companies in the same industry.
- In the last couple of years the Profit Margin of JNJ has grown nicely.
- The Operating Margin of JNJ (27.00%) is better than 70.91% of its industry peers.
- In the last couple of years the Operating Margin of JNJ has grown nicely.
- JNJ has a Gross Margin of 68.14%. This is comparable to the rest of the industry: JNJ outperforms 45.45% of its industry peers.
- JNJ's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27% | ||
| PM (TTM) | 27.26% | ||
| GM | 68.14% |
OM growth 3Y6.15%
OM growth 5Y6.99%
PM growth 3Y8.26%
PM growth 5Y9.82%
GM growth 3Y-0.67%
GM growth 5Y0.65%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), JNJ is creating some value.
- JNJ has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
- JNJ has an Altman-Z score of 4.95. This indicates that JNJ is financially healthy and has little risk of bankruptcy at the moment.
- JNJ has a Altman-Z score of 4.95. This is in the better half of the industry: JNJ outperforms 72.73% of its industry peers.
- The Debt to FCF ratio of JNJ is 2.34, which is a good value as it means it would take JNJ, 2.34 years of fcf income to pay off all of its debts.
- JNJ has a better Debt to FCF ratio (2.34) than 81.82% of its industry peers.
- A Debt/Equity ratio of 0.55 indicates that JNJ is somewhat dependend on debt financing.
- JNJ has a Debt to Equity ratio of 0.55. This is comparable to the rest of the industry: JNJ outperforms 54.55% of its industry peers.
- 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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | 2.34 | ||
| Altman-Z | 4.95 |
ROIC/WACC1.45
WACC9.75%
2.3 Liquidity
- JNJ has a Current Ratio of 1.07. This is a normal value and indicates that JNJ is financially healthy and should not expect problems in meeting its short term obligations.
- JNJ's Current ratio of 1.07 is on the low side compared to the rest of the industry. JNJ is outperformed by 67.27% of its industry peers.
- A Quick Ratio of 0.80 indicates that JNJ may have some problems paying its short term obligations.
- The Quick ratio of JNJ (0.80) is worse than 61.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.07 | ||
| Quick Ratio | 0.8 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 8.11% 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 6.11% on average per year.
- Looking at the last year, JNJ shows a small growth in Revenue. The Revenue has grown by 6.05% in the last year.
- JNJ shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.67% yearly.
EPS 1Y (TTM)8.11%
EPS 3Y2.06%
EPS 5Y6.11%
EPS Q2Q%20.59%
Revenue 1Y (TTM)6.05%
Revenue growth 3Y5.6%
Revenue growth 5Y2.67%
Sales Q2Q%9.08%
3.2 Future
- The Earnings Per Share is expected to grow by 8.17% on average over the next years. This is quite good.
- Based on estimates for the next years, JNJ will show a small growth in Revenue. The Revenue will grow by 5.37% on average per year.
EPS Next Y7.03%
EPS Next 2Y7.63%
EPS Next 3Y7.31%
EPS Next 5Y8.17%
Revenue Next Year6.76%
Revenue Next 2Y6.06%
Revenue Next 3Y6.02%
Revenue Next 5Y5.37%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better 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
- The Price/Earnings ratio is 20.58, which indicates a rather expensive current valuation of JNJ.
- JNJ's Price/Earnings ratio is in line with the industry average.
- The average S&P500 Price/Earnings ratio is at 28.87. JNJ is valued slightly cheaper when compared to this.
- A Price/Forward Earnings ratio of 19.21 indicates a rather expensive valuation of JNJ.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of JNJ is on the same level as its industry peers.
- JNJ is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.96, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.58 | ||
| Fwd PE | 19.21 |
4.2 Price Multiples
- JNJ's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. JNJ is more expensive than 60.00% of the companies in the same industry.
- The rest of the industry has a similar Price/Free Cash Flow ratio as JNJ.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.31 | ||
| EV/EBITDA | 16.85 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- The decent profitability rating of JNJ may justify a higher PE ratio.
PEG (NY)2.93
PEG (5Y)3.37
EPS Next 2Y7.63%
EPS Next 3Y7.31%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.38%, JNJ has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 1.62, JNJ pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.82, JNJ pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.38% |
5.2 History
- The dividend of JNJ is nicely growing with an annual growth rate of 9.24%!
Dividend Growth(5Y)9.24%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
- 48.70% of the earnings are spent on dividend by JNJ. 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.
DP48.7%
EPS Next 2Y7.63%
EPS Next 3Y7.31%
JOHNSON & JOHNSON / JNJ.DE FAQ
Can you provide the ChartMill fundamental rating for JOHNSON & JOHNSON?
ChartMill assigns a fundamental rating of 5 / 10 to JNJ.DE.
What is the valuation status of JOHNSON & JOHNSON (JNJ.DE) stock?
ChartMill assigns a valuation rating of 3 / 10 to JOHNSON & JOHNSON (JNJ.DE). This can be considered as Overvalued.
What is the profitability of JNJ stock?
JOHNSON & JOHNSON (JNJ.DE) has a profitability rating of 7 / 10.
Can you provide the financial health for JNJ stock?
The financial health rating of JOHNSON & JOHNSON (JNJ.DE) is 5 / 10.
Is the dividend of JOHNSON & JOHNSON sustainable?
The dividend rating of JOHNSON & JOHNSON (JNJ.DE) is 5 / 10 and the dividend payout ratio is 48.7%.