Morningstar Rating

Stock Research and Analysis

by Damien Conover, CFA

Bulls Say

Johnson & Johnson faces relatively few major patent losses over the next five years.
Diverse health-care segments insulate the company from downturns in the economy, offering a defensive growth opportunity.
The majority of J&J's key drugs are specialty drugs, which tend to carry strong pricing power. Read more 

Bears Say

Product recalls in the consumer business could dent J&J's strong brand name in a segment where brand recognition is important in maintaining market share.
Potential legal action regarding product recalls for hip and knee replacements along with several consumer products could not only hurt the company's reputation and cost billions of dollars, but also create a major distraction for management.
Several of J&J's key drugs are facing increasing competition, which could slow the growth rate of the drug division. Read more 

Management

Overall, we view the stewardship at J&J as relatively standard. While the firm has an excellent record of making sound capital deployment decisions as well as consistently generating returns on invested capital above the cost of capital, major recalls   Read more 

Profile

Johnson & Johnson is the world's largest and most diverse health-care company. Three divisions make up the company: pharmaceutical, medical devices and diagnostics,   Read more 

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