How to Buy Johnson and Johnson Stock
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Johnson and Johnson is a name we have been aware of since childhood. It is not just a pharmaceutical company but an empire that has grown. Whether it is bathing products or wipes and diapers, Johnson & Johnson is everywhere. A strong player in the consumer goods industry, the company has everything from wipes to vaccines. Johnson & Johnson provides all the means to maintain your health and well-being.
The company is highly stable and well-established in the pharma industry. Johnson & Johnson has a strong history and a long way to go. If you want to own a small part of the company, it is time to invest in Johnson & Johnson stock. Let’s see how you can go about it.
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In this article
Step 1: Finding a broker that offers Johnson & Johnson stock
To invest in stocks, you need to open a brokerage account. Many online brokers help buy specific stocks for beginners who want to learn as they build their portfolios. Here are some great platforms.
M1 Finance
M1 Finance is ideal for long-term investors who want to build a strong portfolio at low costs. It is not a robo-advisor and does not provide a financial advisor, but it will allow you to make decisions based on your financial goals. You can build and manage a portfolio through a simple and user-friendly platform. Your portfolio will be broken down into a pie chart so that it is easy to understand how the assets are divided. Choosing one of the professionally built portfolios is also possible based on different investment strategies. It will serve as the base of the portfolio. You can invest in mutual funds, stocks, and ETFs. M1 Finance allows the purchase of fractional shares.
You can open individual, retirement, joint investment, and trust accounts. All the trades will be commission-free, but you need to maintain a minimum balance of $100 for taxable accounts and $500 for retirement accounts.
Pros and cons
Pros
- Fractional shares of stocks sold
- Commission-free trades
Cons
- No financial advisors
- High minimum deposit
- Beginners may not find it easy to build the pies
Robinhood
A free trading platform, Robinhood allows you to buy Johnson & Johnson stock. It can be used on Apple iOS and Android phones as an app and online. You simply need to sign up and link the bank account to Robinhood to get some free stock from the company. There is no minimum deposit requirement, and you can sign up for Instant and Cash accounts for no monthly fee. The cash account offers zero-commission trades but not instant deposit or settlement. You can upgrade for $5 a month and get a Robinhood Gold account, where you enjoy margin investing and borrow money from Robinhood to buy stocks. If you want to trade on margin, you need to deposit $2,000. It offers fractional shares, so instead of buying one full share of stock, it is possible to buy a fraction of stock for as little as $1.
Pros and cons
Pros
- No monthly fees
- Buy fractional shares of stocks
- No minimum account balances
Cons
- Limited investment products offered
- Not a goal-based strategy
- Commission free stock trading.
- No account minimum.
- Trade stocks, options, ETFs, and more.
- First stock free.
Step 2: Research Johnson & Johnson shares
Johnson & Johnson is an American multinational corporation established in 1886. The company develops pharmaceuticals, medical devices, and consumer goods. It is one of the world's oldest and most valuable companies. Johnson & Johnson is one of the two U.S.-based companies with a prime credit rating of AAA, which is also higher than that of the United States government. It was founded by two brothers, Edward Johnson and James Johnson. Their older brother Robert joined the company later.
Headquartered in New Brunswick, New Jersey, the company has 250 subsidiary companies, operations in 60 countries, and products sold in 175 countries. Its brands include several household names in medications and first aid supplies. Its top consumer products include Band-Aid, Tylenol medications, Clean and Clear face wash, Johnson’s baby products, Acuvue contact lenses, and Neutrogena skin and beauty products.
After operating privately for 58 years, the company went public in 1944. It is listed on the NYSE under the ticker J&J.
Johnson & Johnson's price history
One of the oldest and most established companies, Johnson & Johnson has grown over the years, and it enjoys a strong reputation in the stock market. The stock debuted on September 24, 1944, at $37.50 a share. If you had invested $1,000 in the Johnson & Johnson IPO, you would have received 27 shares.
The company gave a 100% stock dividend three years after the IPO. This would have taken the stock to 54. Further, it issued 3.5% stock dividends, taking your stock holding to 61 by 1951.
It did a stock split in 1959, issuing 2.5 stocks for one stock. Your stockholding would be 152. It gave a 200% stock dividend and announced six stock splits till 2001. Considering the same, your stock holding today would be 65,664 shares. The stock is changing hands at $149 as of May 6, 2024, making your total holding worth $9.7 million. The regular payouts by the company show that they value investors and are looking forward to distributing their profit with the investors. Who said the stock market does not make you wealthy? From $1,000 in 1944 to over $9 million as of 2024.
Johnson & Johnson dividend information
Johnson and Johnson has consistently paid cash dividends for 52 years. It is considered a dividend aristocrat and is the first choice of investors looking to generate passive income through dividends. It enjoys an annual dividend yield of 3.33% and paid a quarterly cash dividend of $1.24 on April 16, 2024.
Best features of Johnson & Johnson stock
Largest healthcare stock. Johnson & Johnson is not solely a publicly traded healthcare stock in terms of market cap but the most diversified company in terms of its offerings. The company’s main business is pharmaceuticals, and it has a portfolio of drugs that treat illnesses ranging from cardiovascular diseases to cancer and infectious diseases. It also has a wide range of oncology drugs in the pipeline. It expects 25 drugs to drive sales growth of 5% to 7% by 2030.
The medical devices segment accounts for over one-quarter of sales, and instruments and surgical systems contribute to their revenue. The biggest advantage of investing in Johnson & Johnson stock is that the company does not rely on any one part of healthcare. It has spread its eggs in different baskets, which makes the stock low-risk and one of the largest and high-growth healthcare stocks.
Stable company for the long term. If you are looking for a stock to hold for the long term, nothing can beat the stability offered by Johnson & Johnson. Its diversification offers stability in all kinds of economic cycles. Even if there is a problem in one business unit, it will not dampen the sales and revenue of the company. Here's a snapshot of the company's Q1 2024 medtech sales by segment:
Dividend aristocrat. Johnson & Johnson is one company that has paid increasing dividends for the past 52 years, and it is no small feat. A dividend yield of 3.33% is respectable, and due to the consistent payout and rise in the dividend, those who purchased the stock two decades back have seen their investment grow significantly. Johnson & Johnson is a dividend grower that should be held for the long term. Most importantly, the company has enough room to keep increasing the payout. Management still has a conservative approach toward dividend payouts, which shows that dividends can increase quickly. Plus, the dividend is not going anywhere.
Strong acquisitions. Johnson & Johnson is highly stable and has a solid cash flow, allowing it to do mergers and acquisitions. The company has been buying its way into the high-growth areas. It has been eyeing medical device companies that bring data science and robotics to the operating room. In 2023, it acquired Laminar, a medical device company; more recently, it announced the acquisition of Shockwave Medical for $13.1 billion to boost the heart device business.
Pharmaceuticals have massive growth potential. The company's pharmaceutical segment is the fastest-growing of all the business units. Pharma sales came in at $4.13 billion in the first quarter. There is a growing demand for its cancer treatment drug Darzalex, which brought in a revenue of $2.6 billion for the quarter. If the company keeps pace, one can expect a revenue as high as $91 billion in 2030.
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Step 3: Open an account & buy Johnson & Johnson shares
Now that you are ready to buy the shares, it is time to open an online brokerage account. You can enjoy low-cost purchases and quick execution with the right account. Let’s look at M1 Finance for details on how to open the account. Open the M1 Finance website and click on Get Started.
Now, you need to provide the email address and password. You will then have to verify the email to start. In the next step, you must create a pie. You can choose any three stocks from all the options available, and the pie will be ready for you.
Once you pick the stocks, you need to provide an investment horizon. Choose from short, long, or average, and then choose the type of investment account you want and fund it. You can begin the investment journey immediately after you link it to the bank account.
Once you create an account with M1 Finance, you should decide the stock price and the number of shares you want to buy. You can also purchase fractional stock. There are two options- limit price and market price. If you set the limit price, you need to set a limit for the purchase, and the order will only be executed when the stock hits the limit price. If you set the market price, the order will be executed immediately at the prevailing stock price.
FAQs
How much were Johnson & Johnson shares when the company first went public?
Johnson & Johnson's stock price was $37.50 when it first went public in 1944.
How much does it cost to buy Johnson & Johnson shares today?
As of closing on May 6, 2024, one Johnson & Johnson share costs $149.
Does Johnson & Johnson pay dividends?
Johnson & Johnson pays a cash dividend and is a dividend aristocrat. It has paid dividends for 52 years.
What is the minimum number of Johnson & Johnson shares that I can buy?
You can purchase one share or a fractional share if you use the right brokerage.
The bottom line
Building a robust portfolio often involves selecting stocks with long-term value, and Johnson & Johnson stands out as a prime candidate. Renowned for its strong history and excellent industry reputation, Johnson & Johnson's involvement in critical sectors like vaccinations has further solidified its stature, particularly under the scrutiny of regulatory bodies like the FDA. This company's stellar fundamentals and reliability make it a compelling stock to buy and hold.
Investors can access Johnson & Johnson's shares through online brokerage accounts like Wealthfront, M1 Finance, or Robinhood, which offer the convenience of real-time trading and the ability to conduct technical analysis. These platforms may also provide opportunities to purchase fractional shares, making investing easier regardless of the share price.
When investing in JNJ stock, listed on the NASDAQ and a key component of the Dow Jones, it's important to consider the market's short-term volatility. However, the company's strong performance history and solid P/E ratio suggest a more stable investment than other stocks. While the best stocks in the market will always experience some fluctuation, an investment in Johnson & Johnson promises potential growth and security, making it a wise choice for new and seasoned investors.
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Editor
Vandita Jadeja is a financial writer and editor at Joywallet. She loves to read and write about money and brings a decade of experience from the financial industry.
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