August 29, 2024
Top 10 Stock Johnson & Johnson Hold Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Johnson & Johnson – Top 10 Stock in Dow Jones Industrial Average
Johnson & Johnson is listed as a top 10 stock on August 29, 2024 in the market index Dow Jones because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low, despite a currently slow growth momentum. Based on the Obermatt 360° View of 37 (37% performer), Obermatt assesses an overall hold recommendation for Johnson & Johnson on August 29, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Pharmaceuticals |
| Index | Dow Jones, Dividends USA, Diversity USA, Human Rights, Moonshot Tech, D.J. US Pharmaceutical, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Johnson & Johnson Hold
| 360 METRICS | August 29, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 55 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 23 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 75 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 54 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 37 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 37 (better than 37% compared with alternatives), overall professional sentiment and financial characteristics for the stock Johnson & Johnson are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half of the indicators below and half above average for Johnson & Johnson. The consolidated Value Rank has an attractive rank of 55, which means that the share price of Johnson & Johnson is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 55% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 75. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 54. But the consolidated Growth Rank has a low rank of 23, which means that the company is below average in terms of growth and momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. 77 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 37, Johnson & Johnson is worse than 63% of all alternative stock investment opportunities based on the Obermatt Method. Three out of four consolidated Obermatt Ranks show above-average performance. The stock has as good value (Value Rank of 55), secure financing practices (Safety Rank of 75), and positive market sentiment in the professional investor community (Sentiment Rank of 54). It is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely to occur. The company’s growth expectations are below the industry average (Growth Rank of 23), but that could also be temporary since professional investors remain optimistic despite the low growth numbers. The low price as reflected in the good Value Rank could indicate that the company's future is challenging. The below-par growth performance may be the reason for this. Companies that grow less are typically cheaper than fast-growing competitors. We recommend evaluating whether the future of Johnson & Johnson is as difficult as the stock’s low price suggests, despite the positive professional investor sentiment. Since the professional community is optimistic, you might have less to worry about, and the stock may just go through a more challenging phase now, indicating good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Johnson & Johnson positive
ANALYSIS: With an Obermatt Sentiment Rank of 54 (better than 54% compared with alternatives), overall professional sentiment and engagement for the stock Johnson & Johnson is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and the other half above average for Johnson & Johnson. Analyst Opinions are at a rank of 31 (worse than 69% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 49, which means that stock research experts are getting more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 46, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 54% of competitors). On the upside, the Professional Investors rank is 96, which means that professional investors hold more stock in this company than in 96% of alternative investment opportunities. Pros tend to favor investing in this company. This could be due to a large company size, which could contribute to the higher share of professional investors in the company. If this is not the case, the low sentiment ranks are more challenging to explain. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 54 (more positive than 54% compared with investment alternatives), Johnson & Johnson has a reputation among professional investors that is above-average compared with that of its competitors. Should the company be on the smaller side, the presence of professional investors could be reassuring. That would make Johnson & Johnson stock something like a hidden gem. Investors should make sure with further research that this is true, because all other sentiment indicators are negative which is a sign for caution. ...read more
Value Strategy: Johnson & Johnson Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 55 (better than 55% compared with alternatives), Johnson & Johnson shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Johnson & Johnson. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 94% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 27 which means that the stock price compared with what market professionals expect for future profits is higher than 73% of comparable companies, indicating a low value concerning Johnson & Johnson's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 48 which means that the stock price compared with what market professionals expect for future profit levels is higher than 52% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 13 is also low. Compared with invested capital, the stock price is higher than for 87% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 55, is a buy recommendation based on Johnson & Johnson's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Johnson & Johnson? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Johnson & Johnson only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: Johnson & Johnson Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 23 (better than 23% compared with alternatives), Johnson & Johnson shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with all four metrics below average for Johnson & Johnson. Sales Growth has a rank of 23, which means that currently professionals expect the company to grow less than 77% of its competitors. The same is valid for Profit Growth, with a rank of 29, and Capital Growth with 46. In addition, Stock Returns have a below market rank of 41, which means that the stock returns have recently been below 59% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 23, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. ...read more
Safety Strategy: Johnson & Johnson Debt Financing Safety very solid
| SAFETY METRICS | August 29, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 60 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 11 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 96 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 75 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 75 (better than 75% compared with alternatives) for 2024, the company Johnson & Johnson has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Johnson & Johnson is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Johnson & Johnson. Leverage is at a rank of 60, meaning the company has a below-average debt-to-equity ratio. It has less debt than 60% of its competitors. Liquidity is also good at a rank of 96, meaning the company generates more profit to service its debt than 96% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 11, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 89% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 75 (better than 75% compared with alternatives), Johnson & Johnson has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Johnson & Johnson. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Johnson & Johnson Below-Average Financial Performance
| COMBINED PERFORMANCE | August 29, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 55 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 23 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 96 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 47 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 47 (worse than 53% compared with investment alternatives), Johnson & Johnson (Pharmaceuticals, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Johnson & Johnson are a good value (attractively priced) with a consolidated Value Rank of 55 (better than 55% of alternatives), are safely financed (Safety Rank of 75, which means low debt burdens), but show below-average growth (Growth Rank of 23). ...read more
RECOMMENDATION: A Combined Rank of 47, is a hold recommendation based on Johnson & Johnson's financial characteristics. As the company Johnson & Johnson's key financial metrics exhibit good value (Obermatt Value Rank of 55) but low growth (Obermatt Growth Rank of 23) while being safely financed (Obermatt Safety Rank of 75), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 55% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.