Companies 0 See All

Hedge Funds 0 See All

Insiders 0 See All

Institutional Investors 0 See All

Click here to see all results for

Does Johnson & Johnson’s (JNJ) Dividend Have Room to Soar?

Published on March 14, 2013 at 5:23 pm by The Motley Fool in News

Page 2 of 2

Future growth
Up to this point, we’ve looked at Johnson & Johnson (NYSE: JNJ)’s dividend in the past, and we’ve also seen how its stock is being perceived by the market today. However, the most important factor to consider when understanding a dividend’s future is where the company’s cash flow is heading. It’s hard to generate more cash without growing sales, so let’s take a look at what industry analysts are expecting for Johnson & Johnson’s revenue growth relative to peers this year.

Foolish bottom line

Investors are flocking toward Johnson & Johnson (NYSE: JNJ)’s dividend for good reason, the company is about as stable as you’ll find in the industry. While its payout ratios might look a bit high relative to pharmaceutical averages, defining Johnson & Johnson as a pharma company doesn’t tell the complete story. Following the recent acquisition of Synthes, its medical devices business is actually a larger contributor to revenue than pharmaceuticals, and the company also sports a sizable consumer products segment. Because this balanced attack insulates Johnson & Johnson (NYSE: JNJ) from the patent risks that are impacting so many of its peers, and given its pristine balance sheet with plenty of room for additional borrowing, it’s a safe bet that this dividend is set to grow.

The article Does Johnson & Johnson’s Dividend Have Room to Soar? originally appeared on Fool.com and is written by Brenton Flynn.

Brenton Flynn has no position in any stocks mentioned. The Motley Fool recommends Johnson & Johnson. The Motley Fool owns shares of Johnson & Johnson.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Page 2 of 2

NYSE:JNJ Johnson & Johnson (JNJ)