J&J: Boringly Profitable (and That’s the Point)

by

Look, I get it. Everyone’s chasing the shiny objects. The AI that’s going to write your screenplay, the space tourism stock that’s definitely not a pyramid scheme… It’s exhausting. Me? I prefer investments that don’t require a panic attack every time the market sneezes. That’s why I own Johnson & Johnson (JNJ 1.87%). And I’m not planning a fire sale anytime soon.

It’s not sexy. It won’t get you invited to exclusive investor conferences. But in a world obsessed with disruption, sometimes the most radical thing you can do is… consistently make money. It’s like wearing sensible shoes to a rave. Unexpected, but effective.

Loading widget...

Reason No. 1: They’ve Been Raising Dividends Since Before Netflix Existed

Sixty-three consecutive years of dividend increases. Let that sink in. That’s longer than most marriages last. And frankly, probably more reliable. They started boosting payouts when JFK was still giving speeches and everyone thought beehive hairdos were a good idea. Through recessions, pandemics, and the rise of avocado toast, J&J just kept… paying. It’s the financial equivalent of your incredibly stable aunt.

Over the last decade, they’ve been consistently adding a few percentage points to the dividend, which adds up nicely. Last year, a 4.8% bump to $1.30 per share. That gives you a yield of 2.1%, which is almost double what the S&P 500 was offering in December (a pathetic 1.15%, honestly). They’re basically printing money, and I’m here for it.

And the payout ratio? A reasonable 46.3%. They’re not stretching to keep the streak alive. They’re actually able to afford it. It’s like finding out your aunt also has a secret trust fund.

Reason No. 2: It Outperformed the S&P 500 Last Year (Which, Let’s Be Honest, Wasn’t a High Bar)

A 60% total return over the past year. Look, I’m not saying it’s going to happen every year. This isn’t a get-rich-quick scheme. It’s more of a… slow-and-steady-wins-the-race-and-allows-you-to-afford-a-decent-retirement kind of thing. But still, five times the return of the S&P 500? That’s… respectable. It’s like being the only adult at a children’s birthday party who remembers to bring a gift.

Revenue was up 6% to $94.2 billion, earnings per share jumped 90.5% to $11.03. Adjusted EPS was $10.79, up 8.1%. And they’re projecting continued growth, with revenue in the $100-101 billion range for 2026. They’re not promising the moon, just… consistent, predictable growth. It’s almost… boring. But in this market, boring is good. It’s like a beige cardigan – always in style.

Reason No. 3: They’re Not Stuck in a Mad Men Episode

Okay, so they’ve been around for 140 years. That’s a lot of board meetings. But they’re not resting on their laurels. They just announced a $1 billion investment in a next-generation cell manufacturing facility outside Philadelphia. It’s like your grandparents learning to use TikTok – surprisingly impressive.

This isn’t just about keeping jobs in the U.S. It’s about reducing costs and streamlining production. They’re planning a total investment of $55 billion in U.S. manufacturing, R&D, and technology through 2029. That’s a serious commitment. They’re not just talking the talk; they’re walking the walk (and investing heavily in comfortable shoes).

They spend a whopping $14.6 billion on R&D annually. That’s a lot of beakers and lab coats. And it pays off. They had 28 programs with over $1 billion in sales last year, and 51 therapies approved. It’s not glamorous, but it’s effective. It’s like the reliable, slightly uncool friend who always remembers your birthday.

So, yeah, J&J isn’t going to make you an overnight sensation. But it’s a solid, dependable investment that I’m happy to hold onto for the long haul. It’s the financial equivalent of a good pair of jeans – comfortable, reliable, and always in style. And in this market, that’s a win.

Read More

2026-02-22 15:52