Is this the best super dividend stock from the financial sector?

Some companies have a better reputation among investors than others. These include Johnson & Johnson, which is considered one of the best resilient stocks ever. But is it really? And what's in store for them now?

Johnson & Johnson is one of the largest and best-known pharmaceutical and healthcare companies in the world. It focuses on the manufacture and sale of a broad portfolio of drugs, medical devices and medical equipment for the general public and healthcare facilities.

JNJ
$153.77 -$0.92 -0.59%

Capital Structure

Market Cap
372.29B
Enterpr. Val.
379.77B
Revenue
86.56B
Shares Out.
2.41B
Debt/Capital
0.32
FCF Yield
5.03%

Valuation / Dividends

P/E
23.65
EPS
6.54
P/S
4.29
P/B
5.34
Div. Yield
3.12%
Div. Payout
30.77%

Capital Eff. / Margins

ROIC
18.21%
ROE
53.33%
ROA
22.11%
Gross
71.28%
Operating
25.96%
Net Profit
43.92%
0
1
2
3
4
5
6
7
8
9

The company is characterized by several strengths. These include a broad product portfolio covering various areas of healthcare, from consumer care to pharmaceuticals to medical devices.

The company's best-known products include diapers sold under various brand names, bandages manufactured for the mass market and a range of pharmaceutical products such as the prostate cancer drug Zytiga and the biological treatment for rheumatic diseases Remicade.

Johnson & Johnson holds a number of patents on advanced drug manufacturing methods, targeted cancer treatments and other pharmaceutical processes. It spends considerable resources on research to be able to acquire new patents and improve its product offerings.

Among its best-known products are established consumer products such as Baby shampoo and diapers, which have been a key source of revenue for the company since its inception. The pharmaceuticals division, which generates significant revenues, has been growing in importance in recent decades.

Company revenue $JNJ-0.6% by segment. Source

Johnson & Johnson is characterized by robust research and innovation, which allows it to add new and better products to its portfolio.

JNJ is considered the biggest innovator in recent times and in general. Source

It's hard to say whether a company is the best in terms of stability or financial health. But in any case, $JNJ-0.6% can be considered extremely high-quality and one of the best in its segment.

The company can draw on its strengths such as its wide product offering, quality, solid financial background and stability. This helps it to maintain a strong market position and grow even in the face of strong competition. This makes Johnson & Johnson one of the largest and most respected brands in its business area.

Another factor is the dividend, whose history here is also impressive.

Indeed, the company's dividend payout is impressive. Source

When I look at this chart, one thing immediately comes to mind. Investors should pay close attention to the rate at which dividends increase when considering dividend growth stocks . Although a company can raise dividends for many decades, if it only makes modest increases, it won't necessarily make much of a difference.

Johnson & Johnson stands out because it not only has a long history of raising dividends, but it also raises dividends aggressively. Over the past 10 years, dividends have increased 85%, which equates to a compound annual growth rate of 6.4%.

Although the company has faced numerous legal challenges and lawsuits related to some of its products, it has maintained a strong profit margin of around 19% over the past five years.

The margin has been consistently around 19% for the last five years. Source

Of course, it is important to remember that not everything has to be rosy.

When Johnson & Johnson reported Q4 2022 results, investors were disappointed by declining overall sales. Total sales were down 4.4% year-over-year to $23.7 billion. Lower sales of the COVID-19 vaccine and a stronger U.S. dollar were primarily to blame.

The consumer health business was flat. To become a more efficient business, the company plans to spin off its consumer health business into a separate company to be called Kenvue in the second half of 2023.

Johnson & Johnson had 2.63 billion shares at the end of the first quarter, equivalent to a market capitalization of $420 billion. Net debt was about $15 billion based on 2022 results, bringing the total value of the company to about $441 billion. Kenvue's $56 billion value represents 13% of Johnson & Johnson's value, as Kenvue is responsible for about 16% of 2022 sales, albeit at a below-average margin.

What's your take on Johnson & Johnson? Do you have it in your portfolio?

Disclaimer: This is in no way an investment recommendation. It is purely my summary and analysis based on data from the internet and other sources. Investing in financial markets is risky and everyone should invest based on their own decisions. I am just an amateur sharing my opinions.

Read the full article for free?
Go ahead 👇

Do you have an account? Then log in . Or create a new one .

"It's hard to say whether the company is the best in terms of stability or financial situation."

JNJ is one of only two companies with a AAA rating, so that probably says something about how their balance sheet is.

I have. I couldn't resist at $153, I've had them on my watchlist for an awfully long time and was waiting for a significant drop.

This is a super stable company. Not just because of what sector it's in, but what they do and how they do it. It's a nice dividend to top it off. At the very least, almost everyone should know it.

Timeline Tracker Overview