JNJ - Embedded Expectations Analysis - 2020 06 08
Johnson & Johnson (JNJ:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) earnings, with a 17.5x Uniform P/E. At these levels, the market has bearish expectations for the firm, but management is confident about their dividend increases, financing availability, and vaccine research technologySpecifically, management is confident they are increasing their dividend for the 58th straight year, that they can secure the most competitive credit spreads available, and that they expect their Medical Device business to stabilize by Q3. In addition, they are confident their coronavirus vaccine research leverages PER.C6 technology to rapidly develop new vaccine candidates, that the healthcare industry can ensure the needed testing capacity with kits, reagents, swabs, and testing procedures, and that they are addressing the acute ventilator shortage with an expansion of VESper Ventilator Expansion Splitter manufacturing at no cost to health providers. Finally, they are confident the firm is built to weather economic downturns
Johnson & Johnson is a holding company engaged in the research and development, manufacture and sale of a range of products in the health care field. The company has three business segments: Consumer, which includes a range of products focused on personal healthcare used in the beauty, over-the-counter pharmaceutical, baby care, oral care, women's health and wound care markets; Pharmaceutical, which is focused on six therapeutic areas: immunology, infectious diseases, neuroscience, oncology, cardiovascular and metabolism and pulmonary hypertension; and Medical Devices, which includes products used in the orthopaedic, surgery, interventional solutions, and eye health fields.
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