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Johnson & Johnson
(NYSE:JNJ)
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Rating:68Neutral
Price Target:
$292.00
â–²(6.90% Upside)
Action:Downgraded
Date:10/23/26
JNJ scores well on underlying financial quality (strong margins, steady growth, reliable free cash flow) and a generally positive earnings outlook with raised 2026 sales guidance. The overall score is held back by a high P/E valuation, mixed technical momentum (negative MACD), and near-term earnings/margin pressure tied to litigation charges, MedTech softness, and transaction-related dilution.
Positive Factors
Innovative Medicine Growth
Strong growth across oncology, immunology, neuroscience, and other therapeutic areas indicates broad product adoption rather than dependence on a single medicine. Multiple expanding brands can sustain revenue momentum, support reinvestment, and help offset future product-level erosion.
Negative Factors
Margin Pressure
The decline in adjusted margins shows that product mix, amortization, research spending, and transaction costs are currently absorbing part of the company’s operating leverage. Persistent pressure would reduce the amount of revenue growth converting into earnings and cash.
Read all positive and negative factors
Positive Factors
Negative Factors
Innovative Medicine Growth
Strong growth across oncology, immunology, neuroscience, and other therapeutic areas indicates broad product adoption rather than dependence on a single medicine. Multiple expanding brands can sustain revenue momentum, support reinvestment, and help offset future product-level erosion.
Read all positive factors
Johnson & Johnson Key Performance Indicators (KPIs)
Any
Revenue by Geography
Shows how much of the company’s revenue is generated in each part of the world, highlighting whether growth is driven by mature markets or expanding international demand. Helpful for spotting concentration risk, the impact of new product launches abroad, and regions where patent expiries or regulatory changes could dent sales.
Shows how much of the company’s revenue is generated in each part of the world, highlighting whether growth is driven by mature markets or expanding international demand. Helpful for spotting concentration risk, the impact of new product launches abroad, and regions where patent expiries or regulatory changes could dent sales.
Data provided by:
The Fly
The FlyJohnson & Johnson (JNJ) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$635.07B
Dividend Yield2%
Average Volume (3M)7.43M
Price to Earnings (P/E)40.0
Beta (1Y)-0.01
Revenue Growth7.81%
EPS Growth-35.95%
CountryUS
Employees141,700
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - General
Share Statistics
EPS (TTM)6.60
Shares Outstanding2,407,310,300
10 Day Avg. Volume8,653,535
30 Day Avg. Volume7,427,954
Financial Highlights & Ratios
PEG Ratio0.21
Price to Book (P/B)6.18
Price to Sales (P/S)5.35
P/FCF Ratio25.59
Enterprise Value/Market Cap1.09
Enterprise Value/Revenue6.96
Enterprise Value/Gross Profit10.12
Enterprise Value/Ebitda22.45
Forecast
1Y Price Target
$288.71Price Target Upside5.70% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering18
EPS Forecast (FY)11.11
Revenue Forecast (FY)$101.21B
Johnson & Johnson Business Overview & Revenue Model
Company Description
Johnson & Johnson is a holding company, which engages in the research, development, manufacture, and sale of products in the healthcare field. It operates through the Innovative Medicine and MedTech segments. The Innovative Medicine segment focuse...
How the Company Makes Money
Johnson & Johnson makes money primarily by selling (1) prescription pharmaceuticals and (2) medical devices/medical technology products and related solutions.
1) Innovative Medicine (Pharmaceuticals): Revenue is generated from the sale of brande...
Johnson & Johnson Earnings Call Summary
Earnings Call Date:Oct 13, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Jan 26, 2027
Earnings Call Sentiment Positive
The call was predominantly positive. Johnson & Johnson reported 6% operational sales growth, strong momentum in Innovative Medicine, significant growth from key oncology, immunology, and neuroscience brands, progress in MedTech innovation, strong cash generation, and raised 2026 guidance. These positives were partly offset by a MedTech performance shortfall, declines in Abiomed, surgery, and STELARA, lower adjusted EPS and margins, and substantial talc litigation and transaction-related charges. Management nevertheless expressed confidence in improving MedTech performance, finishing 2026 strongly, and achieving double-digit growth by the end of the decade.Positive Updates
Q3 Sales Growth Exceeded Expectations
Worldwide sales were $25.4 billion, increasing 6% operationally and ahead of analyst consensus, with growth accelerating sequentially from the second quarter. U.S. growth was 9.1% and growth outside the U.S. was 1.8%.
Negative Updates
GAAP Earnings Were Materially Affected by Litigation and Transaction Costs
Net earnings were $210 million and diluted EPS was $0.09, compared with $2.12 a year ago. Results were affected by the proposed talc litigation resolution and expenses associated with the Firefly Bio transaction and Cell BioMedicines collaboration totaling approximately $7 billion. Adjusted net earnings were $6.3 billion and adjusted diluted EPS was $2.59, down 6.8% and 7.5%, respectively, from the third quarter of 2025.
Read all updates
Q3-2026 Updates
Positive
Negative
Q3 Sales Growth Exceeded Expectations
Worldwide sales were $25.4 billion, increasing 6% operationally and ahead of analyst consensus, with growth accelerating sequentially from the second quarter. U.S. growth was 9.1% and growth outside the U.S. was 1.8%.
Read all positive updates
Company Guidance
For 2026, Johnson & Johnson expects full year operational sales growth in the range of 6.7% to 7.1%, representing operational sales of $100.7 billion at the midpoint or growth of 6.9%; reported sales growth of 7.2% to 7.6%, with a midpoint of $101.2 billion or 7.4%; a decline of approximately 60 basis points in operating margin; net interest expense of $150 million to $200 million; an effective tax rate of 17.0% to 17.5%; adjusted operational earnings per share in the range of $10.95 to $11.05, or 2% at the midpoint; and reported adjusted earnings per share of $11.05 to $11.15, with a midpoint of $11.10, or growth of 2.9%. Excluding the impact of Firefly Bio and Cell BioMedicines transactions of $0.64, reported EPS growth would approach 9%; full year free cash flow guidance remains $21 billion; Firefly Bio and Cell BioMedicines are expected to have a combined dilutive impact of $1.36 per share on a full year adjusted earnings per share next year; and the company expects further acceleration in 2027, with a clear path to double digit growth by the end of the decade.Johnson & Johnson Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
74
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 99.33B | 94.19B | 88.82B | 85.16B | 79.99B | 78.74B |
| Gross Profit | 68.35B | 63.94B | 61.35B | 58.61B | 55.39B | 55.34B |
| EBITDA | 30.81B | 41.05B | 24.78B | 23.32B | 26.61B | 26.75B |
| Net Income | 16.09B | 26.80B | 14.07B | 35.15B | 17.94B | 20.88B |
Balance Sheet | ||||||
| Total Assets | 197.43B | 199.21B | 180.10B | 167.56B | 187.38B | 182.02B |
| Cash, Cash Equivalents and Short-Term Investments | 17.23B | 20.10B | 24.52B | 22.93B | 22.28B | 31.61B |
| Total Debt | 44.65B | 47.93B | 36.63B | 29.33B | 39.64B | 33.75B |
| Total Liabilities | 115.90B | 117.67B | 108.61B | 98.78B | 110.57B | 108.00B |
| Stockholders Equity | 81.53B | 81.54B | 71.49B | 68.77B | 76.80B | 74.02B |
Cash Flow | ||||||
| Free Cash Flow | 20.59B | 19.70B | 19.84B | 18.25B | 17.18B | 19.76B |
| Operating Cash Flow | 26.16B | 24.53B | 24.27B | 22.79B | 21.19B | 23.41B |
| Investing Cash Flow | -9.34B | -23.59B | -18.60B | 878.00M | -12.37B | -8.68B |
| Financing Cash Flow | -18.15B | -5.54B | -3.13B | -15.82B | -8.87B | -14.05B |
Johnson & Johnson Technical Analysis
Positive
273.14
Price Trends
265.02
Negative
257.18
Positive
243.74
Positive
Market Momentum
-1.11
Negative
53.07
Neutral
77.76
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JNJ, the sentiment is Positive. The current price of 273.14 is above the 20-day moving average (MA) of 259.02, above the 50-day MA of 265.02, and above the 200-day MA of 243.74, indicating a neutral trend. The MACD of -1.11 indicates Negative momentum. The RSI at 53.07 is Neutral, neither overbought nor oversold. The STOCH value of 77.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JNJ.
Johnson & Johnson Risk Analysis
Johnson & Johnson disclosed 23 risk factors in its most recent earnings report. Johnson & Johnson reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Johnson & Johnson Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $101.50B | 15.78 | 28.35% | 3.58% | 8.82% | 48.32% | |
71 Outperform | $99.60B | 22.67 | 5.52% | 5.81% | 23.68% | -30.90% | |
68 Neutral | $635.07B | 40.00 | 19.55% | 2.00% | 7.81% | -35.95% | |
67 Neutral | $283.99B | 23.54 | 29.64% | 3.14% | 2.33% | -4.08% | |
66 Neutral | $171.16B | 39.68 | 4.89% | 5.73% | -0.21% | -59.71% | |
60 Neutral | $358.41B | 115.29 | 6.60% | 2.34% | 4.51% | -80.62% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
JNJ
Johnson & Johnson
263.81
77.71
41.75%
GSK
GlaxoSmithKline
50.75
8.43
19.91%
MRK
Merck & Company
145.27
59.78
69.93%
NVS
Novartis
151.12
24.46
19.31%
PFE
Pfizer
30.03
6.88
29.74%
SNY
Sanofi
41.60
-7.84
-15.85%
Johnson & Johnson Corporate Events
Business Operations and StrategyExecutive/Board Changes
Johnson & Johnson announces leadership change in Innovative Medicine
Positive
Aug 4, 2026
On August 4, 2026, Johnson Johnson announced that Jennifer Taubert will retire as Executive Vice President and Worldwide Chairman of Innovative Medicine, effective September 1, 2026, after more than 21 years at the company. Under her leadership, ...
Business Operations and StrategyFinancial DisclosuresM&A Transactions
Johnson & Johnson Updates Guidance After Firefly, Sail Deals
Negative
Jul 29, 2026
On July 29, 2026, Johnson Johnson completed its $1 billion cash acquisition of Firefly Bio, Inc., gaining the Firelink degrader antibody conjugate platform to enhance its oncology portfolio and capabilities in targeting KRAS-driven and other diff...
Business Operations and StrategyLegal Proceedings
Johnson & Johnson Proposes Major Ovarian Talc Settlement
Positive
Jul 28, 2026
Johnson Johnson on July 27, 2026, announced a proposed comprehensive resolution of its remaining ovarian talc litigation with plaintiff firms leading the federal Multi-District Litigation and related state cases, contingent on at least 95% of out...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.