Johnson & Johnson (JNJ)

Good quality company, and has been a great story. Stock is getting a little bit rich. If you own, you might want to consider trimming a little.

This sector is running right up against stiff technical resistance at this time. His FMV is about $110, so even if they could get through the resistance, the real question is “where is it going to go?”. Compounding the problem is that the whole US healthcare index is in the same condition.

2.7% dividend yield which you’ll probably see grow 7%-8% a year. Generating about a 22%-23% return on its equity. A global brand that is unlikely to run into an enormous problem. Rock solid balance sheet.

Have had consistent dividend increases over the years and fully expects these will continue to take place, offers some protection from rising interest rates. A great hold.

Has one of the best records of increasing dividends of any stock globally. This is one where you have finally been rewarded after a few years in the wilderness where it didn’t get a lot of respect. One of the reasons that these big multi-nationals are doing particularly well right now is because of the strength of the euro and the recovery of the euro zone.

A great company, but just trading at a little too high a valuation for him. The valuation just does not support the fundamentals of the company.

Strong business. It is a story of valuation for her. She is pretty positive on the healthcare space. She prefers others.

He is positive on healthcare. Great company. Likes the pharmaceutical area. Recently announced they were selling one of their consumer products which reinforced that they want to become more of a drug company as opposed to being broadly diversified. That is probably a positive thing.

Stock is getting expensive on his calculated Fair Market Value. Not overvalued. It pretty much got to about where he thought it would get and is peaking out at about 4X Book. What is interesting is that the healthcare index is at exactly the same place. The issue is whether they can break out. This company needs more earnings. He is watching it quite carefully.

Loves that management is committed to devoting free cash flow towards dividend increases and share buybacks. Had a little bit of an operating miss in the last quarter, about 2% off on operating margins. Largely due to one-time items and royalty costs. On a go forward basis, he really likes the prospects for its Pharma segment. Some really good catalysts with 2 new drugs that recently got approved by the FDA and European commission. A reasonable price for this would be in the mid-$80.

Is this a good time to get into health care stocks and what would you recommend? Likes Abbott Labs (ABT-N) very much. Spun off their pharmaceutical R&D business about 2 years ago and split themselves up into 4 different divisions. If looking at global healthcare companies, you can’t go wrong with something like Johnson & Johnson (JNJ-N). Products are cheap and they can easily raise costs. Also likes Medtronics (MDT-N) which is a device manufacturer.

Loves the dividend. This is something that most people should have in their portfolio for the long-term. Down on a general selloff but also because of its Asian exposure.

Stock has done quite well but has pulled back with this general correction. Their pharmaceutical division is doing quite well now and is a catalyst for growth going forward. Their consumer product division has very strong brands. They consistently raise their dividend. Yield of 3.05%.

(Market Call Minute.) Kind of lagged the last quarter rally but she sees good growth from its Pharma business and consumer business.

A year ago, when they were having all the problems in their consumer side, was a good time to Buy. Since then the multiple and stock has risen and is now fairly valued at this time.