This stock isn’t going to make you rich. It’s one of those boring resilient stocks that should stand the test of time though. A stock you should highly consider adding to your portfolio if it isn’t already there, and if it is then you should consider adding to your holding.
Johnson & Johnson (JNJ)
Johnson & Johnson is sure to be a stock that will do you well. It’s been around forever, or at least a lot longer than you’ve been around (how about 1886?). There’s nothing that indicates it won’t be around for forever more.
Take a look around your house, in the bathrooms and bedrooms, and you’re sure to find lots of products from this company. Listerine to get your mouth clean, Tylenol for that headache, or a band-aid brand bandage for that booboo mistake you did outside.
I mean, even the name brand “band-aid” is so commonplace that people use it all the time when they actually mean they want an adhesive bandage. When you have a protected trademark that’s frequently used as the generic term it should tell you something.
Johnson and Johnson is diversified within itself
JNJ is not all about band aids though, that’s only a small portion of its success. It gets its revenue from three main areas; Consumer healthcare (20%), Medical devices (35%), and Pharmaceuticals (45%). If you need to add something to your portfolio from the Healthcare or big pharma sector then you need to look no further than Johnson & Johnson. With their brand names and history they pretty much have a stranglehold on the industry.
Not only is Johnson & Johnson diversified in their products and revenue focus, but they are also getting that revenue for a diversified location. JNJ is worldwide exposure. They have their hands in hospitals and homes all over the world getting about half of their revenue from somewhere overseas.
Raise that dividend
Let’s not forget about dividends. Who doesn’t want to collect money from dividends? With Johnson & Johnson you’re sure to do it. How does this sounds, JNJ has increased its dividend payout for the past 50 plus years. That’s over 50 years over increasing dividends including during the most recent financial crisis and downturn in the market. JNJ doesn’t care. It’s a resilient stock. People won’t stop needing bandaids just because the economy isn’t doing well. They won’t stop needing medical attention (with those devices) and doctors will keep prescribing their pharmaceuticals.
If you’re still not convinces, then how about knowing that JNJ is only one of two companies in the US that hold an AAA credit rating. (the only other one is Microsoft)
Should I buy JNJ right now?
All that being said you might be asking if buying JNJ is a smart thing right now given that it’s at an all time high and it’s had a recent run up in price. If you’re planning on making a sizable position then don’t do it all at once. Even if you’re just invest a small amount you can do it over time slowly. Actually, if you can routinely add to your JNJ position over your lifetime you’ll thank yourself one day in the future when you look back and see how much it has ballooned.
The bottom line is you can’t always time the market. The best strategy is to have time IN the market, Not timing THE market. When you have time in the market you will see your position grow. Go with the dividend reinvest option and routinely add to your JNJ position and you will be very happy you did one day. Don’t let the stocks high price scare you from investing, or worse, scare you into selling.