Stock fact sheet · data as of
Johnson & Johnson (JNJ): fair value, margin of safety and Wheel Score
Healthcare · Drug Manufacturers - General · United States · Defensive
Is JNJ undervalued?
At 253.28 (close of 16 Oct 2026), JNJ trades 81% over the GLS average fair value of 139.73, with 1 of 9 models above the price. The stock earns none of the Wheel Score's Value points at this price. That is a statement about price against trailing fundamentals, not about the company's prospects - the Wall Street View and the Growth tab on the Quote page carry the forward numbers.
The 9 models disagree widely: Graham Number gives 71.67 while DCF gives 275.02. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.
The nightly engine files JNJ under Defensive: a low beta, a dividend and positive earnings.
Nine valuation models for JNJ
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 275.02 | +9% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 71.67 | -72% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 213.71 | -16% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 81.33 | -68% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 90.79 | -64% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 178.53 | -30% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 195.75 | -23% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 77.69 | -69% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 73.07 | -71% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -25.74 | -110% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 283.53 | +12% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Financial health is average - JNJ passes 6 of the nine Piotroski tests, which passes the Sunday Scan's "6 or more" rule. The Financials tab on the Quote page shows which tests fail. The GLS Moat score is 6.9 out of 10: a ten-year record that is consistent in some of the metrics the score tracks (revenue, earnings, margins, cash flow, returns on capital) and patchy in others.
Returns on capital are high - ROIC 20.7%, ROE 32.9%, ROA 13.5% - with debt at 0.59 times equity and a free-cash-flow yield of 3.1%.
The dividend yield is 2.08% at a payout ratio of 78%; for a wheel trader holding assigned shares the dividend adds to the covered-call premium, and the ex-dividend date is worth knowing before a call is sold. Revenue comes mainly from Innovative Medicine 65%, Med Tech 35% (quarter Q2 FY2026).
Institutional ownership scores 9/10, insider activity 3/10 and Congressional trading 6/10 on the GLS smart-money scales.
| Piotroski F-score | 6 / 9 | ROIC | 20.7% |
|---|---|---|---|
| GLS Moat | 6.9 / 10 | ROE | 32.9% |
| Debt / equity | 0.59 | ROA | 13.5% |
| Free-cash-flow yield | 3.1% | Payout ratio | 78% |
| Institutions | 9 / 10 | Insiders · Congress | 3 · 6 / 10 |
Wheel Score 54: Fair
JNJ scores 54 out of 100 on the Wheel Score (Fair band, 50-64): a usable but unremarkable fit for the wheel strategy. The parts: Value 0/25, Health 13/20, Moat 10/15, Premium 10/20, Stability 20/20. Value (0/25) is where the points are missing.
Implied volatility is 25% on the near-the-money contracts 20-60 days out: some premium, but under the 35-60% range the Wheel Score pays full marks for (10 of 20 points). The option chain is deep: 337,851 contracts of open interest across all expiries, which means tight fills at most strikes.
Volume runs at 9.3M shares a day on a market cap of $610.4B, with a beta of 0.23 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score gives that 20 of 20.
| Part | Points | From | |
|---|---|---|---|
| Value | 0 / 25 | -81% margin of safety | |
| Health | 13 / 20 | Piotroski 6/9 | |
| Moat | 10 / 15 | moat 6.9/10 | |
| Premium | 10 / 20 | implied volatility 25% | |
| Stability | 20 / 20 | 9.3M shares/day, $610.4B cap, beta 0.23 |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.
Upcoming events
No upcoming earnings date is recorded for JNJ in the nightly calendar. The next ex-dividend date is 24 Nov 2026 (1.34 per share).
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Drug Manufacturers - General
The 12 companies below are the closest to Johnson & Johnson by market cap within the Drug Manufacturers - General industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| ABBV AbbVie Inc. | 283.38 | 103.06 | -175% | 65Good | $500.8B |
| MRK Merck & Co., Inc. | 145.35 | 69.51 | -109% | 59Fair | $358.6B |
| LLY Eli Lilly and Company | 1,251.61 | 720.47 | -74% | 71Good | $1.18T |
| NVS Novartis AG | 150.38 | 144.89 | -4% | 68Good | $285.8B |
| AZN AstraZeneca PLC | 166.68 | 184.44 | +10% | 85Prime | $258.5B |
| AMGN Amgen Inc. | 434.03 | 330.55 | -31% | 65Good | $234.7B |
| GILD Gilead Sciences, Inc. | 157.37 | 138.25 | -14% | 45Weak | $195.1B |
| NVO Novo Nordisk A/S | 39.22 | 173.67 | +77% | 91Prime | $174.9B |
| PFE Pfizer Inc. | 29.21 | 19.78 | -48% | 58Fair | $166.5B |
| BMY Bristol-Myers Squibb Company | 60.57 | 76.74 | +21% | 86Prime | $123.7B |
| GSK GSK plc | 49.02 | 43.72 | -12% | 70Good | $98.2B |
| SNY Sanofi | 39.77 | 63.49 | +37% | 86Prime | $97.4B |
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A free GLS Equity account gets you nightly fair value and the Wheel Score on ~7,400 US stocks, a watchlist, the scanner preview and the Sunday Scan - the same eight-rule screen, emailed every week. Pro adds the full put and call scanners, unlimited watchlists with alerts and the trade journal.
Start free See the Sunday ScanQuestions about JNJ
Is JNJ undervalued right now?
No: at 253.28 the stock trades 81% above the GLS average fair value of 139.73 (data as of 16 Oct 2026), well beyond what trailing earnings, cash flow and book value support.
What is the Wheel Score of JNJ and what does it mean?
JNJ scores 54 out of 100 (Fair). The Wheel Score blends the margin of safety (25 points), Piotroski health (20), the GLS moat (15), the option premium on offer (20) and trading stability (20) into one number that ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned. 80 and above is Prime, 65-79 Good, 50-64 Fair, under 50 Weak.
What is the GLS fair value for JNJ?
139.73 per share as of 16 Oct 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Johnson & Johnson report earnings next?
No upcoming earnings date is recorded for JNJ in our calendar as of 16 Oct 2026; the Calendars page is refreshed every morning.
Does JNJ have listed options, and how liquid are they?
Yes. The nightly snapshot found 1,000 listed contracts with 337,851 open interest across all expiries and implied volatility of 25% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.