(via ZEXPR) If you think, you don’t need to dread another market downturn now that the market is finally afloat, think again. The increased volatility of the market in the past couple of months has definitely set certain precedence among investors as they gear for another possible hit.
You see, if you are a long-term investor, you kind of rely more so on the investments that you have made. Thus, focusing your investment strategies towards stable decisions needs to be your forte. In order for you to not end up in a panicked state every time the market crashes, you need to manage the level of risk present in your portfolio.
This is where having a bulletproof value stock in your portfolio will do you good. RichmondSuper analyst Nate Robinson explains how Johnson & Johnson stock is a worthy buy right now and is totally capable of adding greater equilibrium to your portfolio.
Blue-Chip Value Stock
Johnson & Johnson is one of the topmost in demand blue-chip value stocks for investors in today’s market. A lot of different reasons have contributed to this stock’s sound financial performance which has, in turn, earned it a good reputation for itself.
RichmondSuper analyst Nate Robinson reiterates his stance on this stock’s potential to fortify your basket of stocks for yet another market crash. He establishes fairgrounds on his claim by explaining how the company has been in business for nearly 140 years and is still the leading developer of a broad range of consumer products. From medical devices to pharmaceutical drugs, it has come a long way to establish itself in today’s market.
Another reason why investors are drawn towards this stock has got to be the dividend offered by it. Johnson & Johnson currently yields nearly 2.5% of dividend and the company has a long history of raising its dividend. If that doesn’t convince you, its position in one of the elite clubs of stocks, Dividend Kings certainly will.
Being a member of this club is not easy, as the company needs to raise its dividend every year for 50 years straight in order to be inducted. Johnson & Johnson has managed to do this for nearly 60 years.
Another thing that makes Johnson & Johnson worthy of credibility is its consumer-friendly products. It has managed to build a consistent balance-sheet growth with its impressive range of products.
Robinson evaluates how despite the economic hardships of last year, the company reported a sales growth of 1.2% and that too on an operational basis. This comes right after the 8% year over year sales growth that the company raked in within the last three months of 2020.
The company witnessed an increase in sales within its health and pharmaceutical segments by 3.1% and 8.4% respectively. This was reported during a 12-month period which allowed the offset of the nearly 11% decline in medical devices sales mostly due to the delayed surgical procedures last year.
COVID-19 Vaccine Stronghold
Recently, the company has been in the news owing to its COVID-19 vaccine which was produced by its Belgian subsidiary Janssen Pharmaceutical Companies. This has helped garner increased investor interest in the stock as many of them plan on adding the vaccine to their portfolio.
On 27th Feb., the U.S. Food and Drug Administration gained authorization for the emergency use of the single-shot vaccine. It’s safe to say that the vaccine will prove to be a milestone event for Johnson & Johnson as the company announced on 29th Jan that the phase 3 trial data showcased 85% efficacy of the vaccine in protecting patients from the severe implications of COVOD-19.
Not only that, but it has also proved to be able to provide 100% protection against hospitalization and death after 28 days from immunization.
Several world markets are already placing orders with the company for the vaccine with Canada passing authorization on 5th March and the European Commission granting the vaccine conditional marketing authorization on 11th March.
All in all, things are looking good for the company’s current endeavour as they seek to distribute 100 million doses to the U.S. by the next few months itself.
You might presume there to be a profit margin, but that is not the case here as the company has announced that it will not be making a profit from the doses that have been distributed under the emergency use authorization.
Robinson explores the possibility of the company garnering financial benefit from its vaccine over the long term instead. He doesn’t rule out the fact that being a producer of the vaccine will help the company gain more credibility in the market within the next few months as the demand continues to increase.
So, if these aren’t enough reasons to buy this stock, you are certainly missing out. Johnson & Johnson will help bring in solid financials, strong track records and a diverse and profitable product lineup – which will inevitably help you stabilize your other investments.
Disclaimer: Our content is intended to be used for informational purposes only.
It is very important to do your own research before making any investment based on your own personal circumstances.
You should take independent financial advice from a professional in connection with, or independently research and verify, any information that you find on this article and wish to rely upon, whether for the purpose of making an investment decision or otherwise.