Research archive for JNJ

Yesterday we received quarterly and full year results from one of our staple holdings in New York, often called the bluest of blue chips, Johnson and Johnson. I have written about these guys on numerous occasions but as a reminder and because these numbers shift each quarter, below is the earnings mix of the company. This is for the full year 2012.

They call it the bluest of blue chips. Johnson and Johnson, the $195bn producer of medical devices and diagnostics, pharmaceuticals and consumer health products released third quarter numbers on Tuesday. The company has been busy this year with an acquisition of medical device maker Synthes and a lot of research and development spend hence third quarter profits dropping 7.3% from this time last year.

Johnson & Johnson, one of the best known consumer brands globally, reported second quarter numbers before the market opened on Wall Street yesterday afternoon. Jozi time afternoon of course, I guess we are luckier that US markets are open whilst we are awake and not in the wee hours of the morning. Hmm... another reason not to live too far East of this time zone. JNJ reported revenue of 16.5 billion Dollars, which was actually lower than the comparable Q2 in 2011, mostly as a result of a negative currency translation, which had as much as a 7.5 percent impact. Excluding special items, EPS clocked 1.30 USD, slightly better than expected. The guidance for the full year however was lower than prior guidance with the range now expected to be between 5.00 to 5.07 USD for the current financial year. Prior guidance was 7 cents higher than the top end of the range given. The dividend was actually declared a day prior, 61 cents for the year. So, based on that guidance and 244 cents worth of dividends a year, the stock trades on a forward earnings multiple 13.8 times and a dividend yield of 3.8 percent. That is a huge attraction, that yield is really awesome when compared to that of US treasuries. Oh, and if you need reminding, the stock was higher than it is now in 2008, where it was a little above 71.50 Dollars. That looks like the all time high.

Yesterday we had loads of exciting companies releasing their quarterly earnings. One of those was Johnson & Johnson who reported adjusted earnings which beat forecasts. I say adjusted because they had big legal settlements and product liability costs. Unfortunately that is one of the risks when investing in a big pharmaceutical business.

Johnson & Johnson results, these were quite tricky to look at, remember that there are three distinct parts to this business, the consumer division, which is the lowest margin of all their businesses. But has all the well known brands. But so does the MDD division (Medical devices and diagnostics) and perhaps even more so, Prescription products, where all the high margin stuff comes from. And amazingly some old eerr.... drugs, are still huge sellers.

Johnson & Johnson results yesterday morning, prior to the market opening. A miss by the analyst community, yes, I am going to say that. Not by much, but top line beat expectations which was also pleasing. The company in many ways shares the same sort of characteristics that would attract you to say for instance the aforementioned Coca-Cola. Steady, giant, good brands, solid history, nothing flashy, just a good old product that you know. Innovating in their own way.

Johnson & Johnson. Someone called it the most blue of all blue chips. They make everything in their consumer division from baby shampoo to contact lenses through face wash and mouth wash. Band aids and OTC medicine, well known brands ---> Consumer Products. And then there are the two other major divisions ---> Medical Devices & Diagnostics and the aptly named ---> Prescription Products. Their results two days ago were iffy.