Johnson & Johnson (JNJ

)
A report by Renato Ganoza for Managerial Accounting

Why Johnson & Johnson?
 Highly

diversified holdings: over 90 consumer brands and 230 subsidiaries in the “Johnson & Johnson Family of Companies” revenue streams: consumer products, pharmaceuticals, and medical devices and diagnostics. history of dividends leading back to 1972

 Three

A

Stock Price

(You’re also earning dividends.)

One Month

Six Months

One Year

Five Years

Stock Price

(You’re also earning dividends.)

One Month

Six Months

One Year

Five Years

Ratio Analysis
2006 Payout Ratio 39 2008 39.3 2010 44.1 2012 62.2

Current Ratio
Quick Ratio Debt/Assets Ratio Revenues Operating Income

1.20
0.67 .05

1.65
1.08 .10

2.05
1.62 .16

1.90
1.34 .18

53,324

63,747

61,587

67,224

13,150

15,988

16,527

15,869

Compared to Novartis (NVS)

2011 Inventory Turnover Asset Turnover Payout Ratio 3.49 0.60 64.5

2012 3.14 0.57 62.2

2011 3.16 0.49 67.5

2012 2.96 0.48 63.8

(The entire industry looks pretty good.)

Current Events
 “A

jury… ordered Johnson & Johnson to pay more than $8.3 million in damages to a Montana man in the first of more than 10,000 lawsuits pending against the medical products maker in connection with a nowrecalled artificial hip.” New York Times, March 8th 2013
2012, legendary investor Warren Buffet “reduced his holdings in Johnson & Johnson by 95.24%.” th

 In

Forbes, November 16 2012

Conclusions
 Hold

the stock long-term and reinvest your dividends (or live off the dividend income).

Sources
 Morningstar  Yahoo!  Forbes  The

Finance

New York Times

 Johnson

& Johnson 2012 Annual Report

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