Is Johnson and Johnson Still an Outperform?

With shares of Johnson & Johnson (NYSE:JNJ) trading at around $76.84, is JNJ an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock’s Movement

Johnson & Johnson might not be known as a growth stock, but there are still plenty of growth opportunities for the company in many parts of the world. Johnson & Johnson projects 10 percent to 13 percent growth in emerging markets, on top of 2 percent to 4 percent growth in domestic markets. On a more segmental level, after acquiring Synthes last year, there should be increased growth in Medical Devices & Diagnostics. Furthermore, Johnson & Johnson has pipeline drugs for diabetes, Hepatitis C, chronic lymphocytic leukemia, and rheumatoid arthritis. And Zytgia was recently approved for the early treatment of prostate cancer.

Other than currency fluctuations, there haven’t been many negatives for Johnson & Johnson. This is a company with strong margins, superb cash flow, impressive growth opportunities, a strong history in regards to stock performance, a 3.2 percent yield, and a stellar reputation. It’s interesting to see that there’s a 3.70 percent short position on the stock. Perhaps these individuals took the wrong kind of drugs prior to opening those positions.

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In a moment, we will look at the big-picture numbers prior to forming an opinion on the stock. In the meantime, an effort has been made to offer something different. If you want to learn more about Johnson & Johnson and its history, which dates back to the Civil War, then check out this short video. The running time is 14:57. Otherwise, you can skip this part and turn to the next page.