US · NYSE · JNJ
Johnson & Johnson (JNJ) stock analysis: valuation and financials
Health Care · Biotechnology: Pharmaceutical Preparations
$263.73 -0.1% Price as of Oct 12, 2026
Narrow-moat, 67.9%-gross-margin franchise growing ~6% with modest net debt $28.3B, but 30x earnings and a base case 24% below the $263.73 price — risk/reward negative.
- Market cap
- $636.3B
- P/E
- 30.2x
- EV/Sales
- 6.8x
- FCF yield
- 3.5%
- 52-week range
- $186.00 – $278.43
- Next earnings
- Oct 13, 2026
Research as of Oct 13, 2026
Business quality scorecard
- Growth51
- Profitability87
- Cash flow84
- Balance sheet24
- Capital allocation100
- Innovation39
- Valuation51
0–100, computed from reported financials; higher is better, and a higher valuation score means cheaper.
How it makes money
Wholesalers, hospitals and payors fund prescription medicines (Innovative Medicine, 64.1% of FY2025 revenue and the profit engine) and medical devices (MedTech, 35.9%); FY2025 revenue was $94.2B at a 28.5% net margin.
Financials by year
| FY2021Jan–Dec 2021 | FY2022Jan–Dec 2022 | FY2023Jan–Dec 2023 | FY2024Jan–Dec 2024 | FY2025Jan–Dec 2025 | |
|---|---|---|---|---|---|
| Revenue | $78.7B | $80.0B | $85.2B | $88.8B | $94.2B |
| Revenue growth | -4.7% | +1.6% | +6.5% | +4.3% | +6.0% |
| Gross margin | 70.3% | 69.3% | 68.8% | 69.1% | 67.9% |
| Net income | $20.9B | $17.9B | $35.2B | $14.1B | $26.8B |
| Free cash flow | $19.8B | $17.2B | $18.2B | $19.8B | $19.7B |
| FCF margin | 25.1% | 21.5% | 21.4% | 22.3% | 20.9% |
Amounts in USD · What is free cash flow?
Margins Gross margin fell to 67.88% in FY2025 from 69.07%; TTM 67.91%, Q2 FY2026 68.19%. Pretax margin rose to 34.6% from 18.8% on a ~$7.0B talc reversal; 1H FY2026 pretax margin 25.8% vs 44.1%. STELARA mix and tariffs drive the gross-margin decline.
- Cash flow WatchFY2025 operating cash flow $24.5B vs net income $26.8B (91.5% conversion); TTM OCF $27.6B exceeds TTM net income $21.0B, DATA cash conversion 94.2%.
- Debt LowNet debt $28.3B (total debt $49.0B, cash $20.4B); roughly 0.8x TTM EBITDA of ~$34.0B (pretax income $25.2B + D&A $7.8B + interest $1.0B).
Balance sheet
- Cash & short-term investments
- $20.8B
- Total debt
- $49.0B
- Net debt
- $28.3B
- Net debt / EBITDA
- —
- Current ratio
- 1.1x
As of Jun 28, 2026 · Amounts in USD · How to read a balance sheet
Management and track record
- Management StrongCapital allocation score 100/100: five-year cumulative FCF $94.73B funded $50.36B of acquisitions and $22.93B of buybacks, 3.8x the $5.97B of stock compensation; diluted shares fell 3.0% CAGR.
- Credibility HighFY2025 reported revenue of $94.19B, up 6.0%, finished above the top of the final guided range of $93.5B-$93.9B set in October 2025.
Of 3 guided figures checked: 2 beat, 1 in range, 0 missed.
Valuation range
Implied value per share · Price when researched: $263.73
Each scenario assumes five years of revenue growth, an FCF margin and an exit multiple, discounted to today. The assumptions and sensitivities are in the full report.
The full report also covers
- Revenue, growth and outlook of each segment
- Moat and main competitors
- Key risks
- Capital allocation: where the free cash flow went
- What management promised, and what they delivered
- Scenario assumptions and sensitivities
- A source for every claim
- Ask AI about this company
The full report is for members.