Johnson & Johnson (JNJ), AstraZeneca plc (ADR) (AZN), The Procter & Gamble Company (PG): The Priceless Health Business Every Investor Overlooks

Counting on consumers

However, it’s in advanced economies like the U.S. where Johnson & Johnson’s consumer health business looks to thrive in the foreseeable future. With baby boomers getting older, this generation will need to combat the increasing ailments of aging. Some of that will come in the form of serious illnesses or physical deterioration, but boomers will also need to spend more of their wealth — and they control the vast majority of wealth in the U.S. — in health maintenance. That begins with consumer health, and it should add up to years of strong cash flow for Johnson & Johnson and other heavyweights in the consumer health industry.

Consumer sales never will emerge as Johnson & Johnson’s go-to growth driver, nor should they: Pharmaceuticals and devices form the core of this company’s future. However, consumer sales have an important place in J&J’s portfolio in maintaining the company’s financial stability and allowing it to be more flexible with its other businesses. For investors — income investors, in particular, enthralled by the company’s 3% dividend — that cash flow stability is priceless for a timeless stock like this.

Johnson & Johnson reaches across virtually every niche of the health care sector. For savvy long-term investors, however, its consumer sales are one critical, yet overlooked, piece of the puzzle that separates this standout company and stock from the pack.

The article The Priceless Health Business Every Investor Overlooks originally appeared on Fool.com and is written by Dan Carroll.

Fool contributor Dan Carroll has no position in any stocks mentioned. The Motley Fool recommends Johnson & Johnson and Procter & Gamble. The Motley Fool owns shares of Johnson & Johnson.

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