Johnson Johnson Profitability Analysis

JNJ Stock  USD 147.91  2.17  1.49%   
Considering Johnson Johnson's profitability and operating efficiency indicators, Johnson Johnson's profitability may be sliding down. It has an above-average probability of reporting lower numbers next quarter. Profitability indicators assess Johnson Johnson's ability to earn profits and add value for shareholders.
 
Net Income  
First Reported
1989-03-31
Previous Quarter
B
Current Value
5.4 B
Quarterly Volatility
2.8 B
 
Oil Shock
 
Dot-com Bubble
 
Housing Crash
 
Credit Downgrade
 
Yuan Drop
 
Covid
Sales General And Administrative To Revenue is expected to hike to 0.26 this year, although the value of Price To Sales Ratio will most likely fall to 2.78. At this time, Johnson Johnson's Change To Netincome is relatively stable compared to the past year. Net Income Per Share is expected to hike to 15.33 this year, although the value of Income Before Tax will most likely fall to nearly 11.5 B.
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin0.770.686
Moderately Up
Very volatile
Net Profit Margin0.430.4128
Sufficiently Up
Slightly volatile
Operating Profit Margin0.180.2566
Way Down
Very volatile
Pretax Profit Margin0.170.1769
Sufficiently Down
Slightly volatile
Return On Assets0.140.2098
Way Down
Pretty Stable
Return On Equity0.540.5111
Notably Up
Slightly volatile
For Johnson Johnson profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Johnson Johnson to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Johnson Johnson utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Johnson Johnson's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Johnson Johnson over time as well as its relative position and ranking within its peers.
  
Check out Risk vs Return Analysis.
For more information on how to buy Johnson Stock please use our How to buy in Johnson Stock guide.
Is Johnson Johnson's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Johnson Johnson. If investors know Johnson will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Johnson Johnson listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
0.106
Dividend Share
4.76
Earnings Share
7.43
Revenue Per Share
34.402
Quarterly Revenue Growth
(0.14)
The market value of Johnson Johnson is measured differently than its book value, which is the value of Johnson that is recorded on the company's balance sheet. Investors also form their own opinion of Johnson Johnson's value that differs from its market value or its book value, called intrinsic value, which is Johnson Johnson's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Johnson Johnson's market value can be influenced by many factors that don't directly affect Johnson Johnson's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Johnson Johnson's value and its price as these two are different measures arrived at by different means. Investors typically determine if Johnson Johnson is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Johnson Johnson's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Johnson Johnson Return On Asset vs. Return On Equity Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Johnson Johnson's current stock value. Our valuation model uses many indicators to compare Johnson Johnson value to that of its competitors to determine the firm's financial worth.
Johnson Johnson is rated second overall in return on equity category among related companies. It is rated second overall in return on asset category among related companies reporting about  0.45  of Return On Asset per Return On Equity. The ratio of Return On Equity to Return On Asset for Johnson Johnson is roughly  2.20 . At this time, Johnson Johnson's Return On Equity is relatively stable compared to the past year.Comparative valuation analysis is a catch-all model that can be used if you cannot value Johnson Johnson by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Johnson Johnson's Stock. Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Johnson Johnson's earnings, one of the primary drivers of an investment's value.

Johnson Return On Asset vs. Return On Equity

Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.

Johnson Johnson

Return On Equity

 = 

Net Income

Total Equity

 = 
0.18
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.

Johnson Johnson

Return On Asset

 = 

Net Income

Total Assets

 = 
0.0833
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.

Johnson Return On Asset Comparison

Johnson Johnson is currently under evaluation in return on asset category among related companies.

Johnson Johnson Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Johnson Johnson, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Johnson Johnson will eventually generate negative long term returns. The profitability progress is the general direction of Johnson Johnson's change in net profit over the period of time. It can combine multiple indicators of Johnson Johnson, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-12.5 B-11.9 B
Operating Income21.9 B11.9 B
Income Before Tax15.1 B11.5 B
Total Other Income Expense Net-6.8 B-6.5 B
Net Income13.3 B9.7 B
Income Tax Expense1.7 B2.7 B
Net Income Applicable To Common Shares20.6 B13 B
Net Income From Continuing Ops13.3 B15.1 B
Non Operating Income Net Other-1.2 B-1.2 B
Net Interest Income489 M513.5 M
Interest Income1.3 B1.3 B
Change To Netincome264.6 M277.8 M
Net Income Per Share 14.60  15.33 
Income Quality 1.71  1.42 
Net Income Per E B T 2.33  2.45 

Johnson Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Johnson Johnson. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Johnson Johnson position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Johnson Johnson's important profitability drivers and their relationship over time.

Johnson Johnson Profitability Trends

Johnson Johnson profitability trend refers to the progression of profit or loss within a business. An upward trend means that Johnson Johnson's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Johnson Johnson's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.

Johnson Johnson Profitability Drivers Correlations

One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Johnson Johnson different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Johnson Johnson in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Johnson Johnson's future profitability.

Use Johnson Johnson in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Johnson Johnson position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Johnson Johnson will appreciate offsetting losses from the drop in the long position's value.

Johnson Johnson Pair Trading

Johnson Johnson Pair Trading Analysis

The ability to find closely correlated positions to Johnson Johnson could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Johnson Johnson when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Johnson Johnson - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Johnson Johnson to buy it.
The correlation of Johnson Johnson is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Johnson Johnson moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Johnson Johnson moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Johnson Johnson can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your Johnson Johnson position

In addition to having Johnson Johnson in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Small & Mid Caps ETFs Thematic Idea Now

Small & Mid Caps ETFs
Small & Mid Caps ETFs Theme
ETF themes focus on helping investors to gain exposure to a broad range of assets, diversify, and lower overall costs. The Small & Mid Caps ETFs theme has 12 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Small & Mid Caps ETFs Theme or any other thematic opportunities.
View All  Next Launch
When determining whether Johnson Johnson is a good investment, qualitative aspects like company management, corporate governance, and ethical practices play a significant role. A comparison with peer companies also provides context and helps to understand if Johnson Stock is undervalued or overvalued. This multi-faceted approach, blending both quantitative and qualitative analysis, forms a solid foundation for making an informed investment decision about Johnson Johnson Stock. Highlighted below are key reports to facilitate an investment decision about Johnson Johnson Stock:

Complementary Tools for Johnson Stock analysis

When running Johnson Johnson's price analysis, check to measure Johnson Johnson's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Johnson Johnson is operating at the current time. Most of Johnson Johnson's value examination focuses on studying past and present price action to predict the probability of Johnson Johnson's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Johnson Johnson's price. Additionally, you may evaluate how the addition of Johnson Johnson to your portfolios can decrease your overall portfolio volatility.
Share Portfolio
Track or share privately all of your investments from the convenience of any device
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Portfolio Optimization
Compute new portfolio that will generate highest expected return given your specified tolerance for risk
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Transaction History
View history of all your transactions and understand their impact on performance
To fully project Johnson Johnson's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Johnson Johnson at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Johnson Johnson's income statement, its balance sheet, and the statement of cash flows.
Potential Johnson Johnson investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Johnson Johnson investors may work on each financial statement separately, they are all related. The changes in Johnson Johnson's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Johnson Johnson's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.