JOHNSON & JOHNSON (JNJ)
US4781601046 - Common Stock
JNJ gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 193 industry peers in the Pharmaceuticals industry. JNJ scores excellent points on both the profitability and health parts. This is a solid base for a good stock. JNJ has a valuation in line with the averages, but it does not seem to be growing.
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.
JNJ had positive earnings in each of the past 5 years.
Each year in the past 5 years JNJ had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 8.24%, JNJ belongs to the best of the industry, outperforming 92.11% of the companies in the same industry.
The Return On Equity of JNJ (20.93%) is better than 93.16% of its industry peers.
Looking at the Return On Invested Capital, with a value of 16.28%, JNJ belongs to the top of the industry, outperforming 93.68% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for JNJ is significantly below the industry average of 43.18%.
The last Return On Invested Capital (16.28%) for JNJ is above the 3 year average (14.68%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.24% | ||
| ROE | 20.93% | ||
| ROIC | 16.28% |
ROA(3y)14.01%
ROA(5y)12%
ROE(3y)34.23%
ROE(5y)30.27%
ROIC(3y)14.68%
ROIC(5y)14.11%
1.3 Margins
JNJ has a Profit Margin of 16.74%. This is amongst the best in the industry. JNJ outperforms 90.00% of its industry peers.
JNJ's Profit Margin has improved in the last couple of years.
JNJ's Operating Margin of 27.57% is amongst the best of the industry. JNJ outperforms 92.11% of its industry peers.
In the last couple of years the Operating Margin of JNJ has grown nicely.
JNJ has a Gross Margin of 69.16%. This is in the better half of the industry: JNJ outperforms 72.63% of its industry peers.
JNJ's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.57% | ||
| PM (TTM) | 16.74% | ||
| GM | 69.16% |
OM growth 3Y4.66%
OM growth 5Y2.82%
PM growth 3Y32.32%
PM growth 5Y17.1%
GM growth 3Y1.74%
GM growth 5Y0.67%
2. Health
2.1 Basic Checks
JNJ has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for JNJ has been reduced compared to 1 year ago.
Compared to 5 years ago, JNJ has less shares outstanding
Compared to 1 year ago, JNJ has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.10 indicates that JNJ is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.10, JNJ is in the better half of the industry, outperforming 77.89% of the companies in the same industry.
The Debt to FCF ratio of JNJ is 1.72, which is an excellent value as it means it would take JNJ, only 1.72 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 1.72, JNJ belongs to the best of the industry, outperforming 95.26% of the companies in the same industry.
JNJ has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.47, JNJ is doing worse than 64.21% of the companies in the same industry.
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 | 0.47 | ||
| Debt/FCF | 1.72 | ||
| Altman-Z | 4.1 |
ROIC/WACC1.6
WACC10.16%
2.3 Liquidity
JNJ has a Current 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.
The Current ratio of JNJ (1.03) is worse than 84.74% of its industry peers.
A Quick Ratio of 0.79 indicates that JNJ may have some problems paying its short term obligations.
JNJ's Quick ratio of 0.79 is on the low side compared to the rest of the industry. JNJ is outperformed by 85.79% of its industry peers.
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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.03 | ||
| Quick Ratio | 0.79 |
3. Growth
3.1 Past
JNJ shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -2.38%.
JNJ shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.98% yearly.
JNJ shows a small growth in Revenue. In the last year, the Revenue has grown by 4.77%.
The Revenue has been growing slightly by 0.86% on average over the past years.
EPS 1Y (TTM)-2.38%
EPS 3Y9.11%
EPS 5Y4.98%
EPS Q2Q%-9.02%
Revenue 1Y (TTM)4.77%
Revenue growth 3Y1.03%
Revenue growth 5Y0.86%
Sales Q2Q%5.25%
3.2 Future
JNJ is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 3.28% yearly.
The Revenue is expected to grow by 3.69% on average over the next years.
EPS Next Y-3.64%
EPS Next 2Y1.25%
EPS Next 3Y2.7%
EPS Next 5Y3.28%
Revenue Next Year4.74%
Revenue Next 2Y3.81%
Revenue Next 3Y3.83%
Revenue Next 5Y3.69%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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 14.11.
87.89% of the companies in the same industry are more expensive than JNJ, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.20. JNJ is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 13.51, the valuation of JNJ can be described as correct.
Based on the Price/Forward Earnings ratio, JNJ is valued cheaply inside the industry as 83.68% of the companies are valued more expensively.
JNJ is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 23.73, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.11 | ||
| Fwd PE | 13.51 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of JNJ indicates a rather cheap valuation: JNJ is cheaper than 83.16% of the companies listed in the same industry.
JNJ's Price/Free Cash Flow ratio is rather cheap when compared to the industry. JNJ is cheaper than 85.26% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.77 | ||
| EV/EBITDA | 11.1 |
4.3 Compensation for Growth
JNJ has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.83
EPS Next 2Y1.25%
EPS Next 3Y2.7%
5. Dividend
5.1 Amount
JNJ has a Yearly Dividend Yield of 3.45%. Purely for dividend investing, there may be better candidates out there.
JNJ's Dividend Yield is rather good when compared to the industry average which is at 4.42. JNJ pays more dividend than 93.16% of the companies 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 | 3.45% |
5.2 History
On average, the dividend of JNJ grows each year by 9.96%, which is quite nice.
JNJ has been paying a dividend for at least 10 years, so it has 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)9.96%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
JNJ pays out 79.71% of its income as dividend. This is not a sustainable payout ratio.
The dividend of JNJ is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP79.71%
EPS Next 2Y1.25%
EPS Next 3Y2.7%
JOHNSON & JOHNSON
NYSE:JNJ (12/20/2024, 8:20:30 PM)
Premarket: 144.99 +0.52 (+0.36%)144.47
+0.89 (+0.62%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners72.88%
Inst Owner Change1.47%
Ins Owners0.04%
Ins Owner Change-2.21%
Market Cap347.83B
Analysts75.33
Price Target179.79 (24.45%)
Short Float %0.77%
Short Ratio2.51
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.45% |
Dividend Growth(5Y)9.96%
DP79.71%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.83%
Min EPS beat(2)3.37%
Max EPS beat(2)8.28%
EPS beat(4)3
Avg EPS beat(4)3.2%
Min EPS beat(4)-0.59%
Max EPS beat(4)8.28%
EPS beat(8)7
Avg EPS beat(8)4.22%
EPS beat(12)10
Avg EPS beat(12)3.31%
EPS beat(16)14
Avg EPS beat(16)4.28%
Revenue beat(2)1
Avg Revenue beat(2)0.01%
Min Revenue beat(2)-0.37%
Max Revenue beat(2)0.38%
Revenue beat(4)2
Avg Revenue beat(4)-0.06%
Min Revenue beat(4)-1.06%
Max Revenue beat(4)0.82%
Revenue beat(8)4
Avg Revenue beat(8)-3.38%
Revenue beat(12)4
Avg Revenue beat(12)-11.37%
Revenue beat(16)7
Avg Revenue beat(16)-8.24%
PT rev (1m)0.8%
PT rev (3m)2.8%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-20.55%
EPS NY rev (1m)0.04%
EPS NY rev (3m)-0.77%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.16%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.6%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.11 | ||
| Fwd PE | 13.51 | ||
| P/S | 3.97 | ||
| P/FCF | 16.77 | ||
| P/OCF | 13.83 | ||
| P/B | 4.96 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.1 |
EPS(TTM)10.24
EY7.09%
EPS(NY)10.69
Fwd EY7.4%
FCF(TTM)8.62
FCFY5.96%
OCF(TTM)10.44
OCFY7.23%
SpS36.42
BVpS29.14
TBVpS-5.87
PEG (NY)N/A
PEG (5Y)2.83
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.24% | ||
| ROE | 20.93% | ||
| ROCE | 19.11% | ||
| ROIC | 16.28% | ||
| ROICexc | 19.33% | ||
| ROICexgc | 87.37% | ||
| OM | 27.57% | ||
| PM (TTM) | 16.74% | ||
| GM | 69.16% | ||
| FCFM | 23.66% |
ROA(3y)14.01%
ROA(5y)12%
ROE(3y)34.23%
ROE(5y)30.27%
ROIC(3y)14.68%
ROIC(5y)14.11%
ROICexc(3y)18.17%
ROICexc(5y)17.33%
ROICexgc(3y)73.37%
ROICexgc(5y)78.66%
ROCE(3y)17.59%
ROCE(5y)16.71%
ROICexcg growth 3Y-10%
ROICexcg growth 5Y-0.58%
ROICexc growth 3Y8.38%
ROICexc growth 5Y4.05%
OM growth 3Y4.66%
OM growth 5Y2.82%
PM growth 3Y32.32%
PM growth 5Y17.1%
GM growth 3Y1.74%
GM growth 5Y0.67%
F-Score4
Asset Turnover0.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 1.72 | ||
| Debt/EBITDA | 1.06 | ||
| Cap/Depr | 60.4% | ||
| Cap/Sales | 5.02% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 79.92% | ||
| Profit Quality | 141.28% | ||
| Current Ratio | 1.03 | ||
| Quick Ratio | 0.79 | ||
| Altman-Z | 4.1 |
F-Score4
WACC10.16%
ROIC/WACC1.6
Cap/Depr(3y)55.87%
Cap/Depr(5y)52.76%
Cap/Sales(3y)4.99%
Cap/Sales(5y)4.66%
Profit Quality(3y)80.78%
Profit Quality(5y)102.26%
High Growth Momentum
Growth
EPS 1Y (TTM)-2.38%
EPS 3Y9.11%
EPS 5Y4.98%
EPS Q2Q%-9.02%
EPS Next Y-3.64%
EPS Next 2Y1.25%
EPS Next 3Y2.7%
EPS Next 5Y3.28%
Revenue 1Y (TTM)4.77%
Revenue growth 3Y1.03%
Revenue growth 5Y0.86%
Sales Q2Q%5.25%
Revenue Next Year4.74%
Revenue Next 2Y3.81%
Revenue Next 3Y3.83%
Revenue Next 5Y3.69%
EBIT growth 1Y-0.84%
EBIT growth 3Y5.73%
EBIT growth 5Y3.7%
EBIT Next Year12.04%
EBIT Next 3Y9.16%
EBIT Next 5Y7.7%
FCF growth 1Y16.95%
FCF growth 3Y-3.31%
FCF growth 5Y-0.31%
OCF growth 1Y16.55%
OCF growth 3Y-1.07%
OCF growth 5Y0.53%