Johnson & Johnson (JNJ)

Classic defensive, great company, full valuation. If you don’t care that it goes down when people allocate capital out to get more offensive in their portfolio, that it is fine. He would expect to see that once the economy starts to grow and people start getting more and more focused on inflation, he would see this as a source of capital. Sold his holdings late last year. This is not that cheap. Dividend yield of 2.8%.

Involved in a number of different areas including devices, consumer products and pharmaceuticals. Pharmaceuticals have grown to a point where they represent about half the business. The other 2 are pretty much equally split. The area they have really fallen down on is their hepatitis C drug, which has just not competed against Gilead’s. Also, there has been news about their talcum powder which has some carcinogenic properties. Also, it is trading close to 20X earnings.

Trading at 17X forward earnings, basically at the market valuation, with a similar expected growth rate. Would prefer to see them at a 16X forward earnings, $110. Doesn’t see too much growth or new acquisitions on the horizon.

One of those bellwether companies in healthcare. They have their tentacles in all types of healthcare, drugs, equipment, consumers, etc. A good core play for the portfolio. This should continue to move higher, but will have pullbacks along the way. Use any weakness to get in.

He likes the chart on this. Ever since the January lows, it has finally broken out and has started moving higher. Trading above the 50 and 200 day moving averages, so from a technical perspective, there are no complaints. On valuations it is trading at 17X earnings with a 6% or 7% growth rate, which makes it a little expensive. Nice dividend at 2.8%, and they are probably going to grow that over time. Likes their diversification within the drug space, medical device space and the consumer product space. One name that might be a little cheaper and that he likes a little more, would be AbbVie (ABBV-N). However, if you own this, there is no reason to Sell until it breaks down a bit.

(A Top Pick May 12/15. Up 16.45%.) A diversified Pharma, consumer products and medical devices company. They have 10 drugs over the next 3 years that have the potential of $1 million each. She still likes it. Still a buy.

A solid US play on pharmaceuticals and personal consumer products related to healthcare. One of the few companies that has an AAA rated balance sheet. Has a long history of growing dividends. The pipeline pharmaceutical expiry timeline is manageable. Have some emerging-market exposure which primarily hurts them somewhat on the currency side. If you are going to hold this for the long-term of 5-10 years, he would Buy it now. On a shorter time period, you might want to wait for a pullback.

A fabulous company. Have had their hiccups over the years. They are in 3 major areas including consumers, devices and pharmaceutical. The pharmaceutical area has done the best, and is now pushing 45% of their business. Well-managed and a great balance sheet. Valuation is somewhat high at about 20X earnings.

A high-quality healthcare name in pharmaceuticals, consumer products and medical devices. Has done quite well this past year because of its defensive nature. You might want to wait before buying. Dividend yield of 2.7%, and have increased this over 50 years. Very strong balance sheet.

A unique company in that it has 3 parts, medical devices, Pharma and consumer products. Well diversified, unlike the pure Pharma industry. A great dividend yield of almost 3% and not trading at a huge multiple. Every year they slowly increase their dividend. Incredibly well run and stable.

(Top Pick Mar 12/15, Up 9.62%) She continues to like and hold it. She likes their healthcare and pharma with lots of drugs in the pipeline. They are well diversified and increased their dividend every year for over 50 years. Nice defensive name. She still thinks they can grow their earnings.

(A Top Pick March 5/15. Up 6.87%.) His model price is $119, so it still has a 12% upside.

Abbott Labs (ABT-N) or Johnson & Johnson (JNJ-N)? She likes healthcare as an overall investment because of the demographics. They both have FX headwinds because they are both international. If you want a diversified, more defensive health care company that gives you an attractive yield, she would go with this one. Their AAA balance sheet gives you a yield of around 3%.

For a 3-5 year hold? Good, solid healthcare conglomerate. There are very few companies with an AAA debt rating, and this is one of them. Because of that, they have low cost of capital which enables them to do a lot of things on the M&A front. A good solid hold for 3-5 years.

Has some good technical support at about $98. As long as it holds in there, then it is fine. Doesn’t have a lot of upside potential. His downside target is $71