Fact based stock research
Johnson & Johnson (NYSE:JNJ)

US4781601046

How to read the free 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.

Johnson & Johnson stock research in summary

jnj.com

ANALYSIS: With an Obermatt Combined Rank of 40 (worse than 60% 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 59 (better than 59% of alternatives), are safely financed (Safety Rank of 64, which means low debt burdens), but show below-average growth (Growth Rank of 29). ...read more

RECOMMENDATION: A Combined Rank of 40, 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 59) but low growth (Obermatt Growth Rank of 29) while being safely financed (Obermatt Safety Rank of 64), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 59% 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. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	59
Growth Rank	29
Safety Rank	64
Combined Rank	40

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

This stock has achievements: Top 10 Stock.

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Johnson & Johnson

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	25	65	60	59
GROWTH
GROWTH	72	51	25	29
SAFETY
SAFETY	57	72	73	64
SENTIMENT
SENTIMENT	n/a	75	10	^new
360° VIEW
360° VIEW	n/a	77	27	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Johnson & Johnson is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	25	65	60	59
GROWTH
GROWTH	72	51	25	29
SAFETY
SAFETY	57	72	73	64
COMBINED
COMBINED	54	80	56	40

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Johnson & Johnson the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 59 (better than 59% 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 half of the indicators below and half above average for Johnson & Johnson. Price-to-Profit (also referred to as price-earnings, P/E) is 57 which means that the stock price compared with what market professionals expect for future profits is lower than for 57% of comparable companies, indicating a good value concerning Johnson & Johnson's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 12, which means that the stock price is lower as regards to invested capital than for 12% of comparable investments. On the other hand, Price-to-Sales is less favorable than 75% of alternatives (only 25% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 8% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 59, is a buy recommendation based on Johnson & Johnson's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	19	20	20	25
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	37	58	54	57
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	16	20	18	12
DIVIDEND YIELD
DIVIDEND YIELD	68	96	96	92
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	25	65	60	59

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Johnson & Johnson; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 29 (better than 29% compared with alternatives), Johnson & Johnson shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Johnson & Johnson. Only Capital Growth has a good rank of 59, which means that currently professionals expect the company to grow its invested capital more than 21% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 26 which means that currently professionals expect the company to grow less than 74% of its competitors. Profit Growth with a rank of 21 and Stock Returns with a rank of 49 are also low (below 51% of alternative investments). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 29, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Johnson & Johnson is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	61	27	34	26
PROFIT GROWTH
PROFIT GROWTH	13	66	46	21
CAPITAL GROWTH
CAPITAL GROWTH	n/a	42	23	59
STOCK RETURNS
STOCK RETURNS	59	75	49	49
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	72	51	25	29

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Johnson & Johnson.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 64 (better than 64% compared with alternatives), the company Johnson & Johnson has financing practices on the safer side, which mean that their overall debt burden is lower than average. 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 58, meaning the company has a below-average debt-to-equity ratio. It has less debt than 58% 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 7, 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 93% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 64 (better than 64% compared with alternatives), Johnson & Johnson has a financing structure that is 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. Investors may have a short-term debt challenge with Johnson & Johnson and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	75	67	55	58
REFINANCING
REFINANCING	11	13	21	7
LIQUIDITY
LIQUIDITY	73	96	98	96
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	57	72	73	64

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Johnson & Johnson and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	38	17	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	66	6	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	36	76	^new
MARKET PULSE
MARKET PULSE	n/a	86	26	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	75	10	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Johnson & Johnson.
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