JNJ
Johnson & Johnson
Dividend / Cash flow
★ Quality 70/100Price today
$275.23
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See what it is worthcharlieapp.co
What this business is made of
The business
Scalpels, surgical robots, and patented molecules: it charges to operate on you and to cure you.
After spinning off Kenvue (consumer brands), J&J became a pure drug and medical-technology business. It sells patented medicines and operating-room equipment to hospitals and health systems across half the world. It booked $94.2B with a 68% gross margin and turned $19.7B into free cash flow.
The moat comes from patents with 20 years of exclusivity and from clinical trust: a surgeon doesn't switch instruments on a whim. It reinvests close to 20% of pharma sales into research, which feeds the next product cycle. It's not a monopoly; it's scale, brand, and switching costs.
Revenue history
From $94.9B to $98.0B in 4 years. Sales aren't taking off — the engine is stuck.
Where each $100 of sales goes
Revenue $94.2B · FY2025
Of every $100 in sales, $71 goes to costs and operations; $29 is left as net profit (29% margin).
Catalysts and risks
OTTAVA, its surgical robot, entering to compete against Intuitive's da Vinci.
RYBREVANT gaining ground in lung cancer as a pharma growth engine.
62 straight years raising the dividend, backed by $19.7B in free cash flow.
Talc litigation: thousands of lawsuits still without a final number.
Stelara patent expiration: biosimilars are already eroding that revenue.
Modest real growth after the Kenvue exit; the pipeline has to deliver.
Charlie's note
“Paying 22 times cash flow for a business growing 7% with 68% margins and 62 years of paying dividends is a sensible person's price. Rushing doesn't pay here: the quality is already priced in, so waiting for a better entry point is the boring, correct play.”
Analysis · July 2026
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