Investing in Johnson and Johnson

Johnson and Johnson is a huge healthcare company with products in a variety of different sectors. The company is one of the largest companies in the world and is a component of several large stock market indexes, including the Dow Jones Industrial Average and S&P 500. As a result, many exchange-traded funds (ETFs) hold Johnson and Johnson shares. If you’re looking for a passive way to invest in the company, an ETF like the iShares U.S. Pharmaceuticals ETF (IHE 0.1%) might be a better option for you.

Johnson & Johnson’s long-term track record of dividend increases makes it an attractive investment for investors. The healthcare giant currently pays out a quarterly rate of $1.24 per share, which yields 3%. That’s enough to provide a modest income stream for most investors. In addition, the company regularly raises the rate of its dividend each year. This streak of dividend hikes puts Johnson & Johnson in the elite group of Dividend Kings.

Another reason to invest in JNJ is that the company appears undervalued relative to its industry peers. The company’s forward price-to-earnings ratio stands at around 17 times management’s 2024 earnings-per-share guidance. That’s significantly lower than the decade average of about 23.

A low PE ratio typically indicates that a company’s future growth prospects are relatively strong. In addition, it can be a sign that the market has not yet fully priced in the company’s growth potential.

The company also has a solid balance sheet with ample cash reserves and a healthy debt-to-asset ratio. This combination should allow the company to fund future growth and dividend increases.

In addition to its JNJ dividend, the company has an excellent research and development pipeline that could produce a number of new revenue streams over the next few years. Its R&D efforts focus on such areas as immunology, infectious diseases, neuroscience, oncology, and cardiovascular and metabolism. The company also has a robust product portfolio in the MedTech space, which includes products for orthopedics, surgery, vision, and more.

If you’re ready to invest in JNJ, open an account with a broker that offers Johnson and Johnson stock as a stock option. On the order page, enter the number of shares you want to buy and choose whether to place a’market’ or ‘limit’ order. A’market’ order will purchase shares immediately at the current market price, while a ‘limit’ order allows you to specify an exact price at which you would like to buy shares. Once your order is filled, you can watch your investment by creating a watchlist. This way, you can receive up-to-the-minute updates on your JNJ shares.