JNJ · sample dossier
Johnson & Johnson
49/100
OutdatedGenerated Oct 10, 2026 · 10:00 AM UTC · 1 hour ago
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EquityJohnson & JohnsonXNYS
Decision context
HOLD
70% convictionScore 49 · Hold
A mixed picture — no strong reason to buy or sell right now.
The stock trades 28.0% below our estimate.
Current price
$261.44
Estimated value range
$201.53 – $517.50
Gap vs AlphaDog estimate
+28.0%
Supporting methods disagree by 185% — midpoint is illustrative, not a precise target.
The stock trades at a discount, but execution uncertainties suggest waiting for a clearer catalyst.
Market context
Price
Price when available
Pick how far back the chart looks
1 month
-1.8%
3 months
+1.4%
6 months
+9.6%
1 year
+37.8%
Financial trajectory
Executive summary & thesis
Johnson & Johnson is a global healthcare company with a market capitalization of $630.04B, trading at a P/E ratio of 30.29 and generating free cash flow per share of $9.11.
- Robust cash generation yields free cash flow per share of $9.11, supporting an annual dividend rate of $5.36 per share.
- High pricing power preserves a 68.1% gross margin and 21.5% net margin alongside an Altman Z-score of 4.69.
- Top-line revenue advanced 6.6% YoY in the latest quarter, demonstrating steady commercial demand across health operations.
- Elevated valuation at 30.29 P/E and 18.88 EV/EBITDA leaves shares vulnerable as quarterly EPS contracted by -0.9% YoY.
- A low Piotroski F-score of 3/9 highlights near-term deterioration in underlying operating and financial momentum metrics.
- Trailing three-month insider transactions produced -$38.20M USD in net sales across eight separate divestments.
Things to keep in mind
- 1P/E 30.3xView source
- 2Elevated valuation at 30.29 P/E and 18.88 EV/EBITDA leaves shares vulnerable as quarterly EPS contracted by -0.9% YoY.View source
- 3A low Piotroski F-score of 3/9 highlights near-term deterioration in underlying operating and financial momentum metrics.View source
What to watch next
Factor profile
Balanced operator
| Factor | Score |
|---|---|
| Quality | 73 out of 100 (Strong). Business health — profits, returns, and consistency. Higher means a more durable company. |
| Growth | 26 out of 100 (Weak). How fast sales and earnings are rising. Higher means the business is expanding faster. |
| Value | 41 out of 100 (Neutral). How cheap the stock looks for what you get. Higher means a more attractive price. |
| Safety | 43 out of 100 (Neutral). Balance-sheet cushion and fewer red flags. Higher means less risk of a nasty surprise. |
| Momentum | 61 out of 100 (Neutral). Recent share-price trend. Higher means buyers have been in control lately. |
Another way to look at it
A calmer look at both sides of the Johnson & Johnson story
The prevailing consensus treats Johnson & Johnson as an impenetrable defensive haven, but trading at 30.3 times earnings and 18.9 times EV/EBITDA leaves no margin for error amid deteriorating fundamentals.
Despite revenue growing 6.6% YoY, quarterly EPS contracted 0.9% YoY, indicating meaningful cost pressures eroding bottom-line delivery. A severely depressed Piotroski F-score of 3/9 signals weakening operational momentum and balance sheet efficiency that the pristine Altman Z-score of 4.69 masks. With the stock already retreating below its 50-day moving average and insiders liquidating $38.20M in stock over the trailing three months, the market is mispricing a stagnant legacy asset as a premium quality play. Investors paying a 30.3 P/E multiple for a business with a Growth factor score of just 25.7/100 face sharp multiple compression if top-line gains fail to translate into earnings.
A weak Piotroski F-score of 3/9 reveals underlying operational deterioration that consensus ignores when focusing exclusively on the safe Altman Z-score of 4.69.
The deceleration of annual dividend growth down to 3.1% in April 2026 from 4.8% in April 2025 demonstrates tightening capital return capacity despite $9.11 FCF per share.
Consensus relies on a stale corporate restructuring thesis, as the Orthopaedics business separation announcement dates back to October 14, 2025 (stale by nearly a full year) without updated milestone disclosures.
Assigning a premium 30.3 P/E and 18.9 EV/EBITDA valuation to a company exhibiting a -0.9% YoY quarterly EPS contraction and an anaemic Growth factor score of 25.7/100.
Extrapolating the 37.8% 1-year price gain while technical momentum is already stalling, marked by a -1.8% 1-month return and a drop below the 50-day moving average.
Corporate insiders executing -$38.20M USD in net disposals across eight transactions over the past 90 days directly contradicts executive confidence in current valuation levels.
Revenue Growth (Latest Quarter YoY) drops below 6.6%.
P/E Ratio (TTM) exceeds 30.29 while EPS Growth (Latest Quarter YoY) remains negative at -0.9%.
Cash after investing
See whether Johnson & Johnson still makes cash after it spends to grow.
- Revenue Growth (Latest Quarter YoY) drops below 6.6%.
- P/E Ratio (TTM) exceeds 30.29 while EPS Growth (Latest Quarter YoY) remains negative at -0.9%.
Monitor these triggers
3 checkpoints before the next earnings print
EPS Growth (Latest Quarter YoY), baseline: -0.9%.
Quarterly EPS Growth remains below -0.9% for two consecutive quarters.
Gross Margin drops below 68.1% due to accelerating patent expirations.
Altman Z-Score falls below the safe baseline of 4.69.
For learning and research only — not investment advice. AlphaDog doesn’t hold stocks and isn’t your financial advisor.
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