Bottom Line Up Front
Johnson & Johnson has achieved the following results in the last 10 years:
- Revenue (Mil): $47,348 to $71,312 – [50% Increase]
- Profit Margins: 17.97% to 19.4% – [7% Increase]
- Cash Flow Per Share: $2.99 to $4.80 – [60% Increase]
- Book Value: $10.72 to $31.82 – [196% Increase]
- Outstanding Shares (Mil): 2996 to 2877 – [3% Decrease]
- Dividend: $1.1 to $2.59 – [135% Increase]
- Shareholder Returns: $34.27/share returned to shareholders through dividends and share buybacks
JNJ Stock Dividend Analysis
Johnson and Johnson was founded in 1886 and has been a public company since 1944. Since its inception JNJ has established the most complete healthcare business in the world, generating approximately 70% of their revenues from global leadership in their respective markets. Their consistent performance has yielded them an outstanding track record for growth that very few companies can match. For the last 51 years JNJ has declared consecutive dividend increases along with 30 years of consecutive increases in adjusted earnings.
JNJ’s core business focus is in health and well being products. JNJ has improved patient care and the quality of life for millions of people around the world by delivering surgical innovations, breakthroughs in medicine and legendary products that make quantum leaps in the medical field. This company’s Pharmaceutical business segment has been extraordinary. JNJ is one of the fastest growing pharmaceutical companies in the U.S., Europe and Japan. Their success has been driven by consistent breakthroughs in health & medical advancements, particularly in their core brands such as Prezista (HIV treatment) and Remicade (Treatment for immune-mediated inflammatory diseases). This has led to consistent and continuing growth in their pharmaceutical pipeline.
Chances are you are very familiar with this JNJ consumer business segment which has produced staple health products for almost every household in the world. Their all star brands include:
And many more! Tylenol and Motrin themselves drove US over-the-counter (OTC) growth to approximately 20%. In 2013 the Johnson & Johnson’s OTC brands produced the number one and number two products in the adult and pediatric pain product sector.
Growth – For the past five years, JNJ consistently reinvested approximately 11 percent of sales to support research and development of future products. Their investment R&D ensures that they will continually deliver blockbuster products for consumers. Keep in mind that about 25 percent of JNJ sales come from products they have introduced to the market within the last 5 years.
Johnson & Johnson is truly a global company, with more than 275 operating companies in 60 countries. Although they are headquartered in the United States, JNJ has a global mindset focused on new products, new technologies and new business models that truly connect with their customers. As of last year, 55 percent of Johnson & Johnson’s business comes from outside the United States, and the trend is continuing to grow. They have recently seen an uptick of approximately 22 percent of their sales come from emerging markets such as Brazil, Russia, India and China.
Outlook – Additionally, JNJ has created a whole new business model in China. Johnson & Johnson was one of the first western companies to expand into China 28 years ago which has given them incredible insight towards their aging population and healthcare challenges. This new business model plans to streamline JNJ’s core business segments allowing them to identify and create new opportunities in China’s rapidly growing healthcare system. In a world challenged by a growing number of diseases, aging populations, insufficient health care delivery and rising costs JNJ will continue to innovate new products and processes to satisfy consumers.
By The Numbers – JNJ has achieved great success over the last 10 years! They have increased their book value almost 3 fold, remember that book value is basically a company’s net worth, we subtract all their liabilities from their assets. Additionally they have more than doubled the dividends paid out to investors but more importantly they have returned $34.27 to shareholders through dividends and share buybacks over the last 10 years. If you had purchased this stock 10 years ago you would have paid $37.51 for each share, meaning you will have almost recouped your entire investment through dividends and share buybacks! That’s amazing, if you have a long investment time frame that means the rest of the money you earn is simply icing on the cake.
Do you currently own JNJ? What do you expect to see from Johnson & Johnson over the next 10 years?
This infographic is not a recommendation to purchase this stock but should be used as a reference for your own due diligence. I am not a registered financial advisor, anything you find on my site is for informational purposes only. Investors trade at their own risk.