Healthcare
Diversified healthcare company spanning pharmaceuticals, medical devices, and consumer health.
View forensic reportJNJ has lifted from a 52-week low of $142 to the $234 range, a 64% move, while free cash flow has held at $19.7 billion and the pharma pipeline momentum has accelerated. The litigation overhang has not gone away, but the earnings power has stepped up.
With $19.7 billion in free cash flow, 72.8% gross margins, and a 64-year dividend streak, Johnson & Johnson's path through the Stelara cliff is better funded than the market appreciates.
Post-Kenvue JNJ trades at 22x earnings with a looming Stelara patent cliff worth $4-5 billion in annual revenue. The defensive premium is priced for a company that no longer exists.
Post-Kenvue spin-off, J&J is a pure pharmaceutical and medtech company. Revenue hit $91.7B with a 22% profit margin. The immunology pipeline alone could be worth $20B in peak sales.