Johnson & Johnson Nears $100 Billion in Revenue Amid Headwinds, Strengthening Investment Case

Investors are increasingly concerned about a coming recession or a market downturn, or both. Those worries have been fueled by recent geopolitical and macroeconomic developments, and by the Nasdaq Composite recently dipping below correction territory. In such an environment, some investors look to steady dividend payers, including companies known as “Dividend Kings,” which have raised payouts for at least 50 years. One example highlighted is Johnson & Johnson (JNJ).

Johnson & Johnson faces multiple headwinds

Johnson & Johnson has dealt with several challenges in recent years. The company is still facing thousands of lawsuits from plaintiffs who allege that its talc-based products caused cancer, with claims that the company knew of the risks and did not address them.

The company has also faced patent cliffs. Last year, Johnson & Johnson lost patent exclusivity for Stelara, an immunosuppressant, in the U.S., after the therapy had already lost exclusivity in Europe in 2024.

In addition, Johnson & Johnson is facing government-imposed drug price negotiations in the U.S., which have targeted several of its therapies. As a result, the company is expected to generate lower sales from those products.

Key financial and market data

Despite these pressures, the article points to current market and financial metrics for Johnson & Johnson:

• Current price: $238.46
• Today's change: -1.18% (-$2.85)
• Market cap: $574B
• Day's range: $237.91 - $242.26
• 52-week range: $146.12 - $251.71
• Volume: 7.4M (Avg vol: 8.8M)
• Gross margin: 67.97%
• Dividend yield: 2.18%

Why the business is expected to hold up

The article outlines three reasons Johnson & Johnson is positioned to perform even amid economic stress.

1) Healthcare demand tends to remain resilient

Demand for healthcare products—particularly lifesaving medicines—does not stop or slow significantly during downturns, unlike some other categories of spending.

2) Diversification across pharmaceuticals and medtech

Johnson & Johnson’s business is described as highly diversified. Its pharmaceutical unit spans multiple therapeutic areas, including immunology, oncology, infectious diseases, and neuroscience. The company also has a medtech business that markets products across multiple niches.

3) Financial strength

The article cites Johnson & Johnson’s AAA rating from S&P Global as evidence of strong financial standing, stating that the company is highly unlikely to fail to meet its obligations.

Impact of patent and legal issues

The article notes that Stelara reached peak sales of $10.9 billion in 2023, accounting for almost 13% of Johnson & Johnson’s top-line that year. Losing patent exclusivity for a product of that scale can be a serious challenge for drugmakers.

On litigation, the article says that even losing some patent-related lawsuits would not be a “death blow” for the company. It also states that several judges rejected attempts to pin lawsuits on a subsidiary that would then file for bankruptcy.

Dividend track record and investor relevance

Johnson & Johnson is presented as a stock that could help anchor a portfolio during volatile periods while providing regular payouts. The article emphasizes that Johnson & Johnson has increased its dividends for 63 consecutive years, and suggests that long-term returns could be enhanced for investors who reinvest dividends.