Why This Dividend King Still Stands Tall

Johnson & Johnson (JNJ) remains one of the most resilient and innovative names in the healthcare industry, not just for its robust portfolio of healthcare products but also for its relentless commitment to returning value to shareholders. As of 2025, JNJ continues to carry the status of a "Dividend King," a title bestowed on companies that have consistently increased their dividend payouts for 50 consecutive years or more.

Valued at $425.3 billion, JNJ stock has surged 22% year-to-date (YTD), compared to the broader market gain.

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A 63-Year Streak of Dividend Increases

JNJ has raised its dividend for 63 years in a row, making it one of the most consistent dividend payers in the market. In April, the firm announced a 4.8% increase in its quarterly dividend, to $1.30 per share. This continuous growth reflects JNJ's financial strength and dedication to providing shareholder value.

With a payout ratio (the percentage of earnings distributed as dividends) of 45.7%, the company maintains a balanced strategy, ensuring enough reinvestment in its operations while rewarding investors. This low payout ratio also allows for dividend growth. The current dividend yield is 2.94%, better than the healthcare sector average of 1.58%.

Strong Performance Across Therapeutic Areas

Johnson & Johnson's ability to maintain and grow its dividend is supported by strong financial performance. While the market was skeptical when JNJ chose to spin off its consumer health segment into a new company called Kenvue (KVUE) in 2021, the decision favored JNJ. It allowed the company to focus on its pharmaceutical and medical device businesses, which have stronger growth potential and innovation.

Following the spin-off, JNJ has increased its focus on its pharmaceutical and medical device business segments, now known as Innovative Medicine and MedTech, respectively. J&J's success is driven by its extensive innovation in six high-impact areas: oncology, immunology, neuroscience, cardiovascular, surgery, and vision.

In the most recent second quarter, the Innovative Medicine segment grew 3.8% to deliver more than $15.2 billion in quarterly sales. Remarkably, this growth came despite the loss of exclusivity for STELARA, a multibillion-dollar product used for the treatment of Crohn's disease. In oncology, JNJ posted 22.3% operational sales growth, driven by leading products addressing blood cancers and solid tumors. With over 10 oncology products in the market and more than 25 treatments in late-stage development, the company is on track to exceed $50 billion in oncology sales by 2030.

Story Continues

J&J's immunology portfolio, which includes six medicines across 14 indications, continues to alter the standard of treatment. Notably, in Q2, TREMFYA expanded into inflammatory bowel disease, rising 30% in the quarter, with projected peak annual sales of $10 billion. Furthermore, Icotrokinra, a targeted oral peptide, is slated to file with the FDA in Q3, providing a once-daily pill alternative for plaque psoriasis. In neuroscience, Johnson & Johnson is treating illnesses that affect one in every eight individuals worldwide, including schizophrenia, depression, and Alzheimer's.

Furthermore, MedTech remains a key growth driver, with operating revenues up 6.1% in Q2. JNJ also continues to make progress in the minimally invasive surgical market with its OTTAVA Robotic Surgical System. Notably, JNJ reported $23.7 billion in worldwide sales for the second quarter, with adjusted net earnings of $6.7 billion. Analysts predict 8.7% growth in earnings in 2025, followed by another 4.9% in 2026.

Is JNJ a Buy on Wall Street?

Overall, Wall Street has assigned a “Moderate Buy” rating to JNJ. Out of the 25 analysts covering the stock, 11 rate it a “Strong Buy,” two rate it a “Moderate Buy,” and 12 rate it a “Hold.”

The mean target price on the stock is $180.54, which is 2.2% above current levels. Meanwhile, its high target price of $206 implies a potential upside of 16.6% in the next 12 months.

Johnson & Johnson's ability to innovate in both MedTech and Innovative Medicine, paired with solid financial performance and a healthy pipeline, cements its position as a Dividend King. Even amid challenges such as loss of exclusivity, J&J continues to deliver growth, expand its global footprint, and create meaningful value for shareholders.

With a diverse portfolio, cutting-edge medicines, and a continuous focus on high-growth areas, Johnson & Johnson stands tall as a resilient powerhouse in healthcare.www.barchart.com

On the date of publication, Sushree Mohanty did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com

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