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Top 10 Forever Stocks | a series brought to you by Wyatt Investment Research ----------------------------------------------------------------------------------------- Forever Stock No. 6 is Johnson & Johnson NYSE: JNJ). For this report, I researched a range of industries to bring you stocks that should hold up regardless of market conditions. To keep your portfolio diversified, I chose companies across several unrelated industries, including energy, healthcare, financials, technology, industrial goods and consumer staples. What’s more, several pay healthy dividends, a must in today’s low-interest-rate environment. These stocks are built to last, meaning you should hold onto them for the long haul. I’m sure you’ll be pleased with their performance for many years to come. -----------------------------------------------------------------------------------------
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All Grown Up – And Still Growing
F O R E V E R S T O C K N O . 6
Johnson & Johnson (NYSE: JNJ)
Source: Mark Jackson
In a way, Johnson & Johnson’s (NYSE: JNJ) 70-year history on the New York Stock Exchange has mimicked the very products it sells.
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Johnson & Johnson was most known for its popular baby lotions and shampoos. As the company matured, so too did its target audience. The company expanded into products for adults – consumer goods such as skin creams and hair-care products, prescription products to treat a variety of maladies, and medical devices used in hip replacements and breast cancer treatments.
In its infancy,
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Today Johnson & Johnson is the world’s largest supplier of medical devices, sixth-largest consumer health company, and eighth-largest pharmaceuticals company. Many of its products are household names: Liquid Neutrogena, Rogaine, BAND-AID, Neosporin, Bengay, Listerine, Tylenol, Rolaids and Splenda, to name just a few. Some were Johnson & Johnson originals; others were acquired.
PRODUCT EXPANSION
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Such a diverse array of products is one reason why Johnson & Johnson has a history of being among the most reliable stocks on the market. If one product fails, there are dozens of others that can pick up the slack. That’s how the company has increased its dividend for 51 straight years and grown its earnings for 29 consecutive years. Its current dividend yield of 2.9% is quite attractive … and is likely to only go higher in the coming years.
While the stock price has been rather stagnant the last seven
years, the steady dividend increase has made Johnson & Johnson a stock worth holding. Ten years ago the annual payout was $0.72 per share. Five years ago it was $1.52 per share. Today it is $2.64.
51 YEARS OF DIVIDEND INCREASES
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is of course the main reason behind Johnson & Johnson’s yearly ever-growing dividend. But so is the company’s commitment to rewarding its investors.
In 1972, management instituted a policy of increasing the company’s dividends annually by 10%-19%. They’ve done so at an annual rate of more than 15% ever since.
A healthy bottom line,
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That makes Johnson & Johnson the perfect stock to own not only in today’s volatile market conditions, but in any financial climate. Investors can take solace in the fact that even if Johnson & Johnson’s stock price doesn’t budge in a given year, they will still make money since the dividends are a virtual cinch to keep going up.
THE PERFECT STOCK TO OWN
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Given that the company continues to expand its footprint in one of the fastest growing industries in the world – the drug industry – it’s safe to assume that long-term investors will continue to be rewarded handsomely in the form of dividends.
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Deals like the one Johnson & Johnson struck in 2013 to acquire Aragon Pharmaceuticals, a privately held company known for its prostate-cancer fighting drug ARN-509 and with Bristol Myer Squibb, will keep the company growing. Bristol Myer Squibb has a stronghold in the $20 billion Hepatitis-C drug market.
The two companies are collaborating on a potential therapy for Hepatitis-C that will combine drugs designed by each.
ARAGON PHARMACEUTICALS
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In a time when the credit ratings of some of the most powerful countries in the world are being downgraded seemingly by the day, Johnson & Johnson maintains a perfect AAA rating.
Add in the $13.8 billion in net income the company is sitting on and a history that dates all the way back to the company’s founding in 1886, it’s clear that Johnson & Johnson is a perfect stock to own forever. Even in its old age, Johnson & Johnson still hasn’t lost a step.
WHAT THIS MEANS FOR INVESTORS
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Ready for more?
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