Johnson & Johnson is one of the world’s largest healthcare companies. It earned a revenue of more than $80 billion in 2020. The company does business in close to 175 countries and is the #1 or #2 player in multiple segments within the healthcare industry. Johnson & Johnson also has a stellar track record of paying dividends. It has grown dividends for 59 consecutive years. The stable business prospects of Johnson & Johnson make it one of the best health care stocks for 2021. Investors looking to add positions within the health care industry have plenty of options to choose from. The sector has performed well since the pandemic broke out in early 2020. Johnson & Johnson has a substantial business presence in segments like pharmaceuticals, medical devices, and consumer health.
A Peek Into Johnson & Johnson’s Financials
Johnson & Johnson has increased its revenue earned from close to $65 billion in 2011 to about $82 billion in 2020. Throughout the past decade, the gross margins have sustained above 65%, while operating margins have ranged around the 25% mark. Net income has grown from $9.6 billion in 2011 to $14.7 billion in 2020. Earnings per share have risen from $3.5 in 2011 to $5.5 in 2020. Dividends have increased from $2.25 per share in 2011 to almost $4 per share in 2020, while the payout ratio had steadily risen from 54% in 2011 to 61% in 2020. Given the size and scale of Johnson & Johnson, future dividend increases look likely given the competitive advantages of the company and a reasonable payout ratio. Johnson & Johnson is among the best health care stock to buy.
Johnson & Johnson is up more than 4% for the month of May 2021. The price has been moving sideways since 10th May 2021. Year-to-date, the stock is up 8.7%, while the 5-year absolute returns minus dividends are about 50%.