{"id":44214,"date":"2025-01-24T03:08:32","date_gmt":"2025-01-24T03:08:32","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/investing\/johnson-johnson-is-virtually-irrelevant-to-my-investment-strategy\/"},"modified":"2025-01-24T03:08:32","modified_gmt":"2025-01-24T03:08:32","slug":"johnson-johnson-is-virtually-irrelevant-to-my-investment-strategy","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=44214","title":{"rendered":"Johnson & Johnson Is Virtually Irrelevant To My Investment Strategy"},"content":{"rendered":"


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\"Johnson<\/p>\n

Johnson & Johnson (JNJ) is virtually irrelevant to my investment strategy, and therefore, I rarely look at this investment. With the release of the Q4 and FY2024 financial results on January 22, 2025, I figure this is the opportunity to look at it more closely.<\/p>\n

Twice a year I disclose which companies are my top holdings; this includes exposure to accounts for which I do not divulge details. At the time of my 2024 Year End FFJ Portfolio Review<\/a><\/strong>, JNJ was my 21st largest holding constituting a mere 1.8% of our total holdings. At the time of my April 2021 review, it was ~2.95% of our overall holdings.<\/p>\n

Some investors may disagree with my rationale for reducing my JNJ exposure. How could I think of reducing my exposure in a ‘Dividend King’ that has increased its dividend for 62 consecutive years?<\/p>\n

Well….I have ~$25.8B litigation related expense reasons that JNJ incurred in FY2017 – FY2024; these expenses are ongoing.<\/p>\n

Although JNJ generated ~$14B in after-tax net earnings from continuing operations in FY2024, let us not lose sight that ~$25.8B could have been used to enrich JNJ shareholders instead of law firms. Current JNJ shareholders are ‘holding the bag’.<\/p>\n

Business Overview<\/strong><\/span><\/h2>\n

JNJ is engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field.<\/p>\n

Following the completion of the separation of the Consumer Health business (Kenvue – (KVUE)) in August 2023, JNJ consists of the Innovative Medicine and MedTech business segments that focus on drugs and devices.<\/p>\n

NOTE:<\/strong> KVUE now owns formerly JNJ’s highly recognizable brands<\/a>.<\/p>\n

A high level overview of JNJ and each segment is found on the company’s website<\/strong><\/a> and Part 1 Item 1 within the 2023 Form 10-K found within the SEC Filings section<\/a><\/strong> of the company’s website; the FY2024 Form 10-K is currently unavailable.<\/p>\n

Pipeline<\/strong><\/span><\/h3>\n

A robust pipeline is critically important for pharmaceutical companies. Extensive information on JNJ’s pipeline, key events, and patent expiration are accessible here<\/a>.<\/p>\n

The January 22, 2025 Earnings Release includes tables that reflect JNJ’s US, International, and Worldwide drug sales in Q4 and FY2024 within its Innovative Medicine segment. Despite a diverse pipeline, we see from these tables that JNJ generates a significant percentage of its revenue from a few drugs.<\/p>\n

FY2024 revenue:<\/p>\n