Johnson & Johnson 0

(JNJ) July 2, 2010

Figures in Millions except per share values

Company Overview

ValuationCurrent Price 59.07$ Margin of SafetyNCAV (2.61)$

Total Net Reprod. Cost 32.19$

Earnings Power Value (EPV) 60.00$

Discounted Cash Flow (DCF) 62.04$

Ben Graham Formula $88.26

Key Statistics Valuation RatiosMarket Cap (millions) 162,920.00$ P/E (TTM) 12.4

52-Week High 66.20$ P/S (TTM) 2.6

52-Week Low 55.71$ P/Tang.B (MRQ) 7.7

% off 52-Week Low 6% P/Tang. BV (MRQ) 7.7

FCF/EV (TTM) 7.2%

Cash Flows P/FCF (TTM) 16.8

Free Cash Flow Earnings Yld (TTM) 12.8%

5 yr FCF Growth 9.1% Piotroski (TTM) 7

10 yr FCF Growth 11.5% Altman (MRQ) 4.13

Beneish (TTM) -2.62 Balance Sheet

Effectiveness Cash and Equiv 18,010.00$

CROIC Margins & Profitability Short-Term Investments -$

Avg 34.7% Gross Accts Rec 10,018.00$

FCF/S Gross Margin Inventory 5,308.00$

Avg 19.5% Operating Total Current Assets 41,093.00$

ROA Operating Margin Net PP&E 14,277.00$

Avg 15.5% Net Profit Intangibles 31,776.00$

ROE Net Margin Total Assets 95,673.00$

Avg 27.5%

Financial Strength (MRQ) Total Current Liabilities 18,499.00$

Efficiency Quick Ratio 1.8 Long-Term Debt 8,059.00$

Receivable Turnover (TTM) 6.3 Current Ratio 2.1 Total Liabilities 40,527.00$

Inventory Turnover (TTM) 3.5 LT Debt to Equity 15.2

Asset Turnover (TTM) 0.7 Total Debt to Equity 22.9

Johnson & Johnson is engaged in the research and development, manufacture and

sale of a range of products in the health care field. The Company operates in three

business segments: Consumer, Pharmaceutical, and Medical Devices and

Diagnostics. In July 2009, Johnson & Johnson completed the acquisition of Cougar

Biotechnology, Inc. with approximately 95.9% interest in Cougar Biotechnology's

outstanding common stock. In September 2009, Elan Corporation, plc and Johnson

& Johnson announced that JANSSEN Alzheimer Immunotherapy, a newly formed

subsidiary of Johnson & Johnson, has completed the acquisition of substantially all

of the assets and rights of Elan related to its Alzheimer`s Immunotherapy Program

(AIP). In March 2010, Hypermarcas SA acquired 99.99% of Versoix Participacoes

Ltda from the Company.

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5 Year Historical Price vs DCF Intrinsic Value

Historical Price Intrinsic Value Buy Price

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5Low Risk

High Growth

Under Valued

Well Managed

Good Financial Health

Strong Moat

Johnson & Johnson

(JNJ) Figures in Millions except per share values

7/2/2010

JNJ 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

Income Statement 9 8 7 6 5 4 3 2 1 0Revenue 29,139.0$ 33,004.0$ 36,298.0$ 41,862.0$ 47,348.0$ 50,514.0$ 53,324.0$ 61,095.0$ 63,747.0$ 61,897.0$ 62,502.0$

% change from prev year 13.3% 10.0% 15.3% 13.1% 6.7% 5.6% 14.6% 4.3% -2.9% 1.0%

COGS 7,346.0$ 9,536.0$ 10,447.0$ 12,176.0$ 13,422.0$ 13,954.0$ 15,057.0$ 17,751.0$ 18,511.0$ 18,447.0$ 18,724.0$

COGS (%) 25.2% 28.9% 28.8% 29.1% 28.3% 27.6% 28.2% 29.1% 29.0% 29.8% 30.0%

Gross Profit 21,793.0$ 23,468.0$ 25,851.0$ 29,686.0$ 33,926.0$ 36,560.0$ 38,267.0$ 43,344.0$ 45,236.0$ 43,450.0$ 43,778.0$

Gross Profit (%) 74.8% 71.1% 71.2% 70.9% 71.7% 72.4% 71.8% 70.9% 71.0% 70.2% 70.0%

Operating Expenses

SG&A 10,875.0$ 11,992.0$ 12,216.0$ 14,131.0$ 15,860.0$ 16,877.0$ 17,433.0$ 20,451.0$ 21,490.0$ 19,801.0$ 19,972.0$

SG&A (%) 37.3% 36.3% 33.7% 33.8% 33.5% 33.4% 32.7% 33.5% 33.7% 32.0% 32.0%

R&D 2,926.0$ 3,591.0$ 3,957.0$ 4,684.0$ 5,203.0$ 6,312.0$ 7,125.0$ 7,680.0$ 7,577.0$ 6,986.0$ 7,025.0$

R&D (%) 10.0% 10.9% 10.9% 11.2% 11.0% 12.5% 13.4% 12.6% 11.9% 11.3% 11.2%

Restructuring & M&A -$ -$ -$ -$ -$ -$ -$ 745.0$ -$ 1,073.0$ 1,073.0$

Other Operating Expense -$ 105.0$ 189.0$ 918.0$ 18.0$ 362.0$ 559.0$ 807.0$ 181.0$ -$ -$

Other Special Charges 21.0$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Operating Income 7,971.0$ 7,780.0$ 9,489.0$ 9,953.0$ 12,845.0$ 13,009.0$ 13,150.0$ 13,661.0$ 15,988.0$ 15,590.0$ 15,708.0$

Operating Income (%) 27.4% 23.6% 26.1% 23.8% 27.1% 25.8% 24.7% 22.4% 25.1% 25.2% 25.1%

Other Income and Expense

Interest Income 379.0$ 456.0$ 256.0$ 177.0$ 195.0$ 487.0$ 829.0$ 452.0$ 361.0$ 90.0$ 92.0$

Other Income (expense) (67.0)$ (185.0)$ (294.0)$ 385.0$ (15.0)$ 214.0$ 671.0$ (534.0)$ 1,015.0$ 526.0$ 2,045.0$

Interest expense 146.0$ 153.0$ 160.0$ 207.0$ 187.0$ 54.0$ 63.0$ 296.0$ 435.0$ 451.0$ 453.0$

Income Before Taxes 6,622.0$ 7,898.0$ 9,291.0$ 10,308.0$ 12,838.0$ 13,656.0$ 14,587.0$ 13,283.0$ 16,929.0$ 15,755.0$ 17,392.0$

Income Taxes 1,822.0$ 2,230.0$ 2,694.0$ 3,111.0$ 4,329.0$ 3,245.0$ 3,534.0$ 2,707.0$ 3,980.0$ 3,489.0$ 4,107.0$

Tax Rate % 27.5% 28.2% 29.0% 30.2% 33.7% 23.8% 24.2% 20.4% 23.5% 22.1% 23.6%

Net Income: Cont. Operations 4,800.0$ 5,668.0$ 6,597.0$ 7,197.0$ 8,509.0$ 10,411.0$ 11,053.0$ 10,576.0$ 12,949.0$ 12,266.0$ 13,285.0$

Net Income 4,800.0$ 5,668.0$ 6,597.0$ 7,197.0$ 8,509.0$ 10,411.0$ 11,053.0$ 10,576.0$ 12,949.0$ 12,266.0$ 13,285.0$

Net Income (%) 16.5% 17.2% 18.2% 17.2% 18.0% 20.6% 20.7% 17.3% 20.3% 19.8% 21.3%

Shares and EPS

EPS: Basic 1.73$ 1.87$ 2.20$ 2.42$ 2.87$ 3.50$ 3.76$ 3.67$ 4.62$ 4.45$ 4.82$

EPS: Diluted 1.70$ 1.84$ 2.16$ 2.40$ 2.84$ 3.46$ 3.73$ 3.63$ 4.57$ 4.40$ 4.76$

Shares: Basic 2,780.6 3,033.8 2,998.3 2,968.1 2,968.4 2,973.9 2,936.4 2,882.9 2,802.5 2,759.5 2,755.4Shares: Diluted 2,834.8 3,099.3 3,054.1 3,008.1 3,003.5 3,012.5 2,961.0 2,910.7 2,835.6 2,789.1 2,797.3

Balance SheetAssets

Cash and Equiv 3,411.0$ 3,758.0$ 2,894.0$ 5,377.0$ 9,203.0$ 16,055.0$ 4,083.0$ 7,770.0$ 10,768.0$ 15,810.0$ 13,743.0$

Short-Term Investments 2,333.0$ 4,214.0$ 4,581.0$ 4,146.0$ 3,681.0$ 83.0$ 1.0$ 1,545.0$ 2,041.0$ 3,615.0$ 4,267.0$

Accts Rec 4,464.0$ 4,630.0$ 5,399.0$ 6,574.0$ 6,831.0$ 7,010.0$ 8,712.0$ 9,444.0$ 9,719.0$ 9,646.0$ 10,018.0$

% change from prev year 3.6% 14.2% 17.9% 3.8% 2.6% 19.5% 7.8% 2.8% -0.8% 3.7%

Inventory 2,842.0$ 2,992.0$ 3,303.0$ 3,588.0$ 3,744.0$ 3,959.0$ 4,889.0$ 5,110.0$ 5,052.0$ 5,180.0$ 5,308.0$

% change from prev year 5.0% 9.4% 7.9% 4.2% 5.4% 19.0% 4.3% -1.1% 2.5% 2.4%

Other Current Assets 2,400.0$ 2,879.0$ 3,089.0$ 3,310.0$ 3,861.0$ 4,287.0$ 5,290.0$ 6,076.0$ 6,797.0$ 5,290.0$ 5,525.0$

Total Current Assets 15,450.0$ 18,473.0$ 19,266.0$ 22,995.0$ 27,320.0$ 31,394.0$ 22,975.0$ 29,945.0$ 34,377.0$ 39,541.0$ 38,861.0$

Net PP&E 6,971.0$ 7,719.0$ 8,710.0$ 9,846.0$ 10,436.0$ 10,830.0$ 13,044.0$ 14,185.0$ 14,365.0$ 14,759.0$ 14,277.0$

Intangibles 7,256.0$ 9,077.0$ 9,246.0$ 11,539.0$ 11,842.0$ 12,175.0$ 28,688.0$ 28,763.0$ 27,695.0$ 31,185.0$ 31,776.0$

Other Long-Term Assets 1,644.0$ 3,219.0$ 3,334.0$ 3,883.0$ 3,719.0$ 3,626.0$ 5,849.0$ 8,061.0$ 8,475.0$ 9,197.0$ 8,527.0$

Total Assets 31,321.0$ 38,488.0$ 40,556.0$ 48,263.0$ 53,317.0$ 58,025.0$ 70,556.0$ 80,954.0$ 84,912.0$ 94,682.0$ 93,441.0$

Liabilities & Stockholders' Equity

Accts Payable 2,083.0$ 2,838.0$ 3,621.0$ 4,966.0$ 5,227.0$ 4,315.0$ 5,691.0$ 6,909.0$ 7,503.0$ 5,541.0$ 5,126.0$

Short-Term Debt 1,479.0$ 565.0$ 2,117.0$ 1,139.0$ 280.0$ 668.0$ 4,579.0$ 2,463.0$ 3,732.0$ 6,318.0$ 4,044.0$

Taxes Payable -$ -$ -$ -$ -$ -$ -$ -$ 417.0$ 442.0$ 1,373.0$

Accrued Liabilities -$ 4,104.0$ 5,001.0$ 7,343.0$ 8,420.0$ 7,652.0$ 8,891.0$ 10,465.0$ 9,200.0$ 9,430.0$ 7,956.0$

Other Short-Term Liabilities 3,578.0$ 537.0$ 710.0$ -$ -$ -$ -$ -$ -$ -$ -$

Total Current Liabilities 7,140.0$ 8,044.0$ 11,449.0$ 13,448.0$ 13,927.0$ 12,635.0$ 19,161.0$ 19,837.0$ 20,852.0$ 21,731.0$ 18,499.0$

Long-Term Debt 2,037.0$ 2,217.0$ 2,022.0$ 2,955.0$ 2,565.0$ 2,017.0$ 2,014.0$ 7,074.0$ 8,120.0$ 8,223.0$ 8,059.0$

Other Long-Term Liabilities 3,336.0$ 3,994.0$ 4,388.0$ 4,991.0$ 5,012.0$ 5,502.0$ 10,063.0$ 10,724.0$ 13,429.0$ 14,140.0$ 13,969.0$

Total Liabilities 12,513.0$ 14,255.0$ 17,859.0$ 21,394.0$ 21,504.0$ 20,154.0$ 31,238.0$ 37,635.0$ 42,401.0$ 44,094.0$ 40,527.0$

Total Equity 18,808.0$ 24,233.0$ 22,697.0$ 26,869.0$ 31,813.0$ 37,871.0$ 39,318.0$ 43,319.0$ 42,511.0$ 50,588.0$ 52,914.0$ Total Liabilities & Equity 31,321.0$ 38,488.0$ 40,556.0$ 48,263.0$ 53,317.0$ 58,025.0$ 70,556.0$ 80,954.0$ 84,912.0$ 94,682.0$ 93,441.0$

Cash Flows StatementCash Flows From Operating ActivitiesNet Income 4,800.0$ 5,668.0$ 6,597.0$ 7,197.0$ 8,509.0$ 10,411.0$ 11,053.0$ 10,576.0$ 12,949.0$ 12,266.0$ 13,285.0$

Depr & Amort 1,515.0$ 1,605.0$ 1,662.0$ 1,869.0$ 2,124.0$ 2,093.0$ 2,177.0$ 2,777.0$ 2,832.0$ 2,774.0$ 2,832.0$

Deferred Taxes (167.0)$ (106.0)$ (74.0)$ (720.0)$ (498.0)$ (46.0)$ (1,168.0)$ (1,762.0)$ 22.0$ (436.0)$ (688.0)$

Other 415.0$ 1,697.0$ (9.0)$ 2,249.0$ 996.0$ (581.0)$ 2,186.0$ 3,658.0$ (831.0)$ 1,967.0$ 2,005.0$

Cash from Operations 6,563.0$ 8,864.0$ 8,176.0$ 10,595.0$ 11,131.0$ 11,877.0$ 14,248.0$ 15,249.0$ 14,972.0$ 16,571.0$ 17,434.0$

Cash Flows From Investing ActivitiesCap Ex (1,646.0)$ (1,731.0)$ (2,099.0)$ (2,262.0)$ (2,175.0)$ (2,632.0)$ (2,738.0)$ (3,310.0)$ (3,066.0)$ (2,365.0)$ (2,327.0)$

Purchase of Business -$ -$ -$ -$ -$ -$ -$ -$ (1,214.0)$ (2,470.0)$ (1,951.0)$

Other (722.0)$ (2,362.0)$ (98.0)$ (2,264.0)$ (172.0)$ 2,353.0$ (17,553.0)$ (2,829.0)$ 93.0$ (2,763.0)$ (4,126.0)$

Cash from Investing (2,368.0)$ (4,093.0)$ (2,197.0)$ (4,526.0)$ (2,347.0)$ (279.0)$ (20,291.0)$ (6,139.0)$ (4,187.0)$ (7,598.0)$ (8,404.0)$

Cash Flows From Financing ActivitiesNet Issuance of Stock (681.0)$ (2,056.0)$ (6,148.0)$ (872.0)$ (742.0)$ (1,021.0)$ (5,587.0)$ (4,045.0)$ (6,651.0)$ (2,130.0)$ (1,679.0)$

Net Issuance of Debt -$ -$ -$ -$ -$ -$ -$ -$ 10,044.0$ 9,274.0$ 6,712.0$

Dividends (1,724.0)$ (2,047.0)$ (2,381.0)$ (2,746.0)$ (3,251.0)$ (3,793.0)$ (4,267.0)$ (4,670.0)$ (5,024.0)$ (5,327.0)$ (5,404.0)$

Other (695.0)$ (1,148.0)$ 1,576.0$ (245.0)$ (1,155.0)$ 293.0$ 3,745.0$ 3,017.0$ (5,833.0)$ (5,909.0)$ (7,675.0)$

Cash from Financing (3,100.0)$ (5,251.0)$ (6,953.0)$ (3,863.0)$ (5,148.0)$ (4,521.0)$ (6,109.0)$ (5,698.0)$ (7,464.0)$ (4,092.0)$ (8,046.0)$

Currency Adj (47.0)$ (40.0)$ 110.0$ 277.0$ 190.0$ (225.0)$ 180.0$ 275.0$ (323.0)$ 161.0$ 170.0$

Change in Cash 1,048.0$ (520.0)$ (864.0)$ 2,483.0$ 3,826.0$ 6,852.0$ (11,972.0)$ 3,687.0$ 2,998.0$ 5,042.0$ 1,154.0$

Free Cash FlowCash from Operations 6,563.0$ 8,864.0$ 8,176.0$ 10,595.0$ 11,131.0$ 11,877.0$ 14,248.0$ 15,249.0$ 14,972.0$ 16,571.0$ 17,434.0$

Cap Ex (1,646.0)$ (1,731.0)$ (2,099.0)$ (2,262.0)$ (2,175.0)$ (2,632.0)$ (2,738.0)$ (3,310.0)$ (3,066.0)$ (2,365.0)$ (2,327.0)$

Free Cash Flow 4,917.0$ 7,133.0$ 6,077.0$ 8,333.0$ 8,956.0$ 9,245.0$ 11,510.0$ 11,939.0$ 11,906.0$ 14,206.0$ 15,107.0$

Owner Earnings FCF 4,669.0$ 5,542.0$ 6,160.0$ 6,804.0$ 8,458.0$ 9,872.0$ 10,492.0$ 10,043.0$ 12,715.0$ 12,675.0$ 13,790.0$

User Defined

Enter Ticker Refresh Help

Johnson & Johnson Shares Out. M.O.S Growth Discount % Terminal % Select FCF Adjust 2009 FCF

(JNJ) Check Shares 2,760.00 10.3%

7/2/2010Select input with

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your own value

Current Price Intrinsic $ Buy Under Actual M.O.S 52 Wk High 52 Wk Low

$59.07 $62.04 $31.02 5% $66.20 $55.71

Fiscal Year Trend 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

Cash Flow Data

Cash from Operations $6,563.0 $8,864.0 $8,176.0 $10,595.0 $11,131.0 $11,877.0 $14,248.0 $15,249.0 $14,972.0 $16,571.0 $17,434.0

Capex $1,646.0 $1,731.0 $2,099.0 $2,262.0 $2,175.0 $2,632.0 $2,738.0 $3,310.0 $3,066.0 $2,365.0 $2,327.0

Cash Flow $3,501.8 $3,264.6 $4,201.3 $4,705.8 $5,676.2 $6,591.5 $6,663.5 $6,673.0 $7,856.3 $8,136.6 $8,057.9

Free Cash Flow $4,917.0 $7,133.0 $6,077.0 $8,333.0 $8,956.0 $9,245.0 $11,510.0 $11,939.0 $11,906.0 $14,206.0 $15,107.0

YOY% Change 45.1% -14.8% 37.1% 7.5% 3.2% 24.5% 3.7% -0.3% 19.3% 6.3%

Margins

Gross Margin 74.8% 71.1% 71.2% 70.9% 71.7% 72.4% 71.8% 70.9% 71.0% 70.2% 70.0%

Operating Margin 27.4% 23.6% 26.1% 23.8% 27.1% 25.8% 24.7% 22.4% 25.1% 25.2% 25.1%

Net Margin 16.5% 17.2% 18.2% 17.2% 18.0% 20.6% 20.7% 17.3% 20.3% 19.8% 21.3%

Margins

Diluted EPS $1.70 $1.84 $2.16 $2.40 $2.84 $3.46 $3.73 $3.63 $4.57 $4.40 $4.76

Tax Rate 27.5% 28.2% 29.0% 30.2% 33.7% 23.8% 24.2% 20.4% 23.5% 22.1% 23.6%

Efficiency & Profitability

CROIC 29.1% 33.4% 30.6% 35.8% 32.5% 27.8% 50.7% 36.9% 32.7% 34.0% 35.0%

FCF/Sales 16.9% 21.6% 16.7% 19.9% 18.9% 18.3% 21.6% 19.5% 18.7% 23.0% 24.2%

Inventory Turnover 258.5% 318.7% 316.3% 339.4% 358.5% 352.5% 308.0% 347.4% 366.4% 356.1% 352.8%

Return On Assets (ROA) 15.3% 14.7% 16.3% 14.9% 16.0% 17.9% 15.7% 13.1% 15.2% 13.0% 14.2%

Retun On Equity (ROE) 25.5% 23.4% 29.1% 26.8% 26.7% 27.5% 28.1% 24.4% 30.5% 24.2% 25.1%

Debt Related

Debt to Equity 66.5% 58.8% 78.7% 79.6% 67.6% 53.2% 79.4% 86.9% 99.7% 87.2% 76.6%

Capitalization Ratio 9.8% 8.4% 8.2% 9.9% 7.5% 5.1% 4.9% 14.0% 16.0% 14.0% 13.2%

FCF to Total Debt 39.3% 50.0% 34.0% 39.0% 41.6% 45.9% 36.8% 31.7% 28.1% 32.2% 37.3%

FCF to Short Term Debt 332.5% 1262.5% 287.1% 731.6% 3198.6% 1384.0% 251.4% 484.7% 319.0% 224.8% 373.6%

FCF to Long Term Debt 241.4% 321.7% 300.5% 282.0% 349.2% 458.4% 571.5% 168.8% 146.6% 172.8% 187.5%

5 Year Multi-Year Performance2004-2008 2005-2009 2004-2007 2005-2008 2006-2009 2004-2006 2005-2007 2006-2008 2007-2009 Median

Tang Shareholder Equity -7.2% -6.8% -10.0% -16.8% 22.2% -27.0% -24.7% 18.1% 15.5% -7.2%

Free Cash Flow 7.4% 11.3% 10.1% 8.8% 7.3% 13.4% 13.6% 1.7% 9.1% 9.1%

CROIC 32.7% 34.0% 34.7% 34.8% 35.5% 32.5% 36.9% 36.9% 34.0% 34.7%

FCF/Sales 18.9% 19.5% 19.2% 19.1% 20.6% 18.9% 19.5% 19.5% 19.5% 19.5%

ROA 15.7% 15.2% 15.8% 15.5% 14.2% 16.0% 15.7% 15.2% 13.1% 15.5%

ROE 27.5% 27.5% 27.1% 27.8% 26.3% 27.5% 27.5% 28.1% 24.4% 27.5%

Gross Margin 71.7% 71.0% 71.7% 71.4% 71.0% 71.8% 71.8% 71.0% 70.9% 71.4%

Operating Margin 25.1% 25.1% 25.2% 24.9% 24.9% 25.8% 24.7% 24.7% 25.1% 25.1%

Net Margin 20.3% 20.3% 19.3% 20.5% 20.1% 20.6% 20.6% 20.3% 19.8% 20.3%

Revenue Growth 7.7% 5.2% 8.9% 8.1% 5.1% 6.1% 10.0% 9.3% 0.7% 7.7%

Earnings Growth 12.6% 6.2% 8.5% 9.7% 5.7% 14.6% 2.4% 10.7% 10.1% 9.7%

Cash from Ops Growth 7.7% 8.7% 11.1% 8.0% 5.2% 13.1% 13.3% 2.5% 4.2% 8.0%

10 Year Multi-Year Performance2000-2007 2001-2008 2002-2009 2000-2005 2001-2006 2002-2007 2003-2008 2004-2009 Median

Tang Shareholder Equity 3.4% -0.3% 5.4% 17.3% -6.8% 1.6% -0.7% -0.6% 0.6%

Free Cash Flow 13.5% 7.6% 12.9% 13.5% 10.0% 14.5% 7.4% 9.7% 11.5%

CROIC 32.9% 33.1% 33.4% 31.6% 32.9% 34.2% 34.3% 33.4% 33.2%

FCF/Sales 19.2% 19.2% 19.2% 18.6% 19.4% 19.2% 19.2% 19.2% 19.2%

ROA 15.5% 15.5% 15.5% 15.6% 15.8% 15.8% 15.5% 15.5% 15.5%

ROE 26.8% 27.1% 27.1% 26.8% 27.1% 27.1% 27.1% 27.1% 27.1%

Gross Margin 71.4% 71.2% 71.1% 71.4% 71.4% 71.4% 71.3% 71.3% 71.4%

Operating Margin 25.2% 24.9% 25.1% 25.9% 25.2% 25.2% 24.9% 25.1% 25.2%

Net Margin 17.6% 18.1% 19.0% 17.6% 18.1% 18.1% 19.1% 20.1% 18.1%

Revenue Growth 11.2% 9.9% 7.9% 11.6% 10.1% 11.0% 8.8% 5.5% 10.0%

Earnings Growth 11.4% 13.9% 10.7% 15.3% 15.2% 10.9% 13.7% 9.2% 12.6%

Cash from Ops Growth 12.8% 7.8% 10.6% 12.6% 10.0% 13.3% 7.2% 8.3% 10.3%

Projection of future Free Cash FlowGrowing at 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

10% $15,665.78 $17,275.56 $19,050.76 $20,236.21 $22,107.70 $24,152.27 $26,385.92 $26,930.84 $29,172.40 $31,600.53

Terminal Growth 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

3% 32,548.54$ 33,525.00$ 34,530.75$ 35,566.67$ 36,633.67$ 37,732.68$ 38,864.66$ 40,030.60$ 41,231.52$ 42,468.47$

CalculationPresent Value

Shares Outstanding

Per Share Value

Margin of Safety

Purchase Price

Current Price

Actual Discount

2760

62.04$

171,218$

5%

15.0% 3%50%

50%

31.02$

59.07$

FCF

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Shares Out. M.O.S Growth Projection EPS Corp Bond

(JNJ)Check

Shares9.7% $4.58 4.93

7/2/2010

Current Price Intrinsic $ Buy Under Actual M.O.S 52 Wk High 52 Wk Low

$59.07 $88.26 $30.01 33% $66.20 $55.71

2004-2008 2005-2009 2004-2007 2005-2008 2006-2009 2004-2006 2005-2007 2006-2008 2007-2009 Median

5 Yr EPS Growth 12.6% 6.2% 8.5% 9.7% 5.7% 14.6% 2.4% 10.7% 10.1% 9.7%

2000-2007 2001-2008 2002-2009 2000-2005 2001-2006 2002-2007 2003-2008 2004-2009

10 Yr EPS Growth 11.4% 13.9% 10.7% 15.3% 15.2% 10.9% 13.7% 9.2%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

Diltued EPS 1.70$ 1.84$ 2.16$ 2.40$ 2.84$ 3.46$ 3.73$ 3.63$ 4.57$ 4.40$ 4.76$

2010E 2011E

Forecast Method 4.58$ 5.03$

Linear Regression Method 4.43$ 5.91$

Normal Earnings 4.58$

Growth Rate 9.72%

Corp Bond Rate 4.93

Per Share Value 88.26$

MOS 66%

Purchase Price 30.01$

Current Price $59.07

Actual Discount 33%

Median

12.6%

Graham Value Calculation

66%2,760.00 Forecast

Johnson & Johnson

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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010E 2011E

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Johnson & Johnson Shares Out. Source Normalized Income Discount Rate R&D Years SG&A %

(JNJ)Check

Shares2,760.00 MSN $16,516.56 20%

7/2/2010Figures in Millions except per share values

Current Price EPV Net Reproduction Value EPV MOS NCAV 52 Wk High 52 Wk Low

$59.07 $60.00 $32.19 1.5% ($2.61) $66.20 $55.71

Asset Valuation Section EPV Valuation Section

Data: Asset Valuation Values for Normalized IncomeShares Outstanding 2760.0 Normalized Income 16,516.6$

Balance Sheet Assets 95,673.0$ Avg Adj. Income 5 yrs 15,905.2$

Adjusted Assets 95,673.0$ TTM Adjusted Income 18,320.6$

Total Liabilities 40,527.0$

Total Equity 55,146.0$ Data: EPVAverage SGA % 33.1% Cost of Capital 9.0%

Marketing/Brand Value 20,460.5$ Normalized Adjusted Income 16,516.6$

R&D Value 17,905.6$ Average Maintenance Capex 2,088.6$

Cash Needed for Business 625.0$ Interest Bearing Debt 12,103.0$

Interest Bearing Debt 12,103.0$ 1% of sales 625.0$

Non Interest Bearing Debt 28,424.0$ Cash & Equiv 18,010.0$

Excess Cash 16,772.1$ Cash - Debt 5,282.0$

Shares 2760.00

Calculation: Asset Valuation

Total Per Share Calculation: EPVTangible BV 23,370$ 8.47$ Cost of Capital Rates EPV Per Share + Cash - Debt Per Share

Adjusted BV 55,146$ 19.98$ 5% 288,558.6$ 104.55$ 293,840.6$ 106.46$

NCAV (7,191)$ (2.61)$ 7% 206,113.3$ 74.68$ 211,395.3$ 76.59$

Reprod. Cost of Assets 134,039$ 48.56$ 9% 160,310.3$ 58.08$ 165,592.3$ 60.00$

Reprod. Cost of Assets BV 93,512$ 33.88$ 11% 131,163.0$ 47.52$ 136,445.0$ 49.44$ Total Net Reprod. Cost 88,843$ 32.19$ 13% 110,984.1$ 40.21$ 116,266.1$ 42.13$

Quarterly numbers based on: 2010 Q1 Statement Source Date: 10-May-10

Adjustments:

Assets Book Value +/- BV Multiplier

Reproduction

Asset Value

Adjustments:

Liabilities & Equity Book Value Fixed BV Multiplier

Reproduction

Liability Value

Cash & Equivalents 18,010.0$ 18,010.0$ Accounts Payable 5,126.0$ 5,126.0$

Marketable Securities -$ -$ Accrued Expenses 7,956.0$ 7,956.0$

Accounts Receivable - Gross 10,018.0$ 10,018.0$ Accrued Liabilities -$ -$

Other Receivable -$ -$ Notes Payable/Short Term Debt 4,044.0$ 4,044.0$

Receivables 10,018.0$ 10,018.0$

Current Port. of LT Debt/Capital

Leases -$ -$

Inventories: Raw Materials 1,002.0$ Other Current Liabilities 1,373.0$ 1,373.0$

Inventories: Work in Progress 1,467.0$ Total Current Liabilities 18,499.0$ 18,499.0$

Inventories: Purchased Components -$ Long-Term Debt 8,059.0$ 8,059.0$

Inventories: Finished Goods 2,839.0$ Capital Lease Obligations -$ -$

Inventories: Other -$ Deferred Income Taxes 1,672.0$ 1,672.0$

Inventories -- Total 5,308.0$ 5,308.0$ Minority Interest -$ -$

Prepaid Expenses 3,293.0$ 3,293.0$ Total Other Liabilities 12,297.0$ 12,297.0$

Current Defered Income Taxes 2,232.0$ 2,232.0$ Total Liabilities 40,527.0$ 40,527.0$

Other Current Assets 2,232.0$ 2,232.0$ Common Stock Equity 52,914.0$ 52,914.0$

Total Current Assets 41,093.0$ 41,093.0$ Retained Earnings 73,184.0$ 73,184.0$

Goodwill, Net 14,977.0$ 14,977.0$ Total Capitalization 60,973.0$ 60,973.0$

Intangibles, Net 16,799.0$ 16,799.0$ Total Equity 52,914.0$ 55,146.0$ Intangibles 31,776.0$ 31,776.0$ Total Liabilities & Equity 93,441.0$ 93,441.0$

Property/Plant/Equipment - Net 14,277.0$ 14,277.0$

Long Term Investments -$ -$

Note Receivable - Long Term -$ -$

Other Long Term Assets, Total 8,527.0$ 8,527.0$ Total Assets 95,673.0$ 95,673.0$

9% 3

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(JNJ)7/2/2010 Current Price NNWC NNWC % NCAV NCAV %

$59.07 -$4.47 -1420.2% -$0.60 -9885.9%

Numbers as of 2010/03 (go to SEC for accurate numbers)

Figures in Millions except per share values BV

BV

Multiplier

Net Net

Value

Cash & Equivalents 18,010.00$ 100% 18,010.00$

Marketable Securities -$

Accounts Receivable 10,018.00$ 75%

Other Receivable -$

Receivables 10,018.00$ 7,513.50$

Inventories: Raw Materials 1,002.00$ 50%

Inventories: Work in Progress 1,467.00$

Inventories: Purchased Components -$

Inventories: Finished Goods 2,839.00$

Inventories: Other -$

Inventories -- Total 5,308.00$ 2,654.00$

Current Assets - Total 38,861.00$ 38,861.00$

Total Liabilities 40,527.00$ 40,527.00$ Shares Outstanding 2,760 2,760

Total ($m) Per Share

Total Current Assets 38,861.00$ 14.08$

Market Cap & Share Price 162,920.00$ 59.07$

Net Net Working Capital (12,349.50)$ (4.47)$

Discount to NNWC -1420%

Net Current Asset Value (1,666.00)$ (0.60)$

Discount to NCAV -9886%

Johnson & Johnson

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Johnson & Johnson

(JNJ)7/2/2010

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

Piotroski F Scores 5 5 8 5 9 7 5 5 7 6 7

Piotroski 1: Net Income 1 1 1 1 1 1 1 1 1 1 1

Piotroski 2: Operating Cash Flow 1 1 1 1 1 1 1 1 1 1 1

Piotroski 3: Return on Assets 0 0 1 0 1 1 0 0 1 0 1

Piotroski 4: Quality of Earnings 1 1 1 1 1 1 1 1 1 1 1

Piotroski 5: LT Debt vs Assets 1 1 1 0 1 1 1 0 0 1 1

Piotroski 6: Current Ratio 0 1 0 1 1 1 0 1 1 1 1

Piotroski 7: Shares Outstanding 1 0 1 1 1 0 1 1 1 1 0

Piotroski 8: Gross Margin 0 0 1 0 1 1 0 0 1 0 0

Piotroski 9: Asset Turnover 0 0 1 0 1 0 0 0 0 0 1

MRQ2000/12 2001/12 2002/12 2003/12 2004/12 2005/12 2006/12 2007/12 2008/12 2009/12 2010/03

Working Capital 8,310$ 10,429$ 7,817$ 9,547$ 13,393$ 18,759$ 3,814$ 10,108$ 13,525$ 17,810$ 20,362$

Total Assets 31,321$ 38,488$ 40,556$ 48,263$ 53,317$ 58,025$ 70,556$ 80,954$ 84,912$ 94,682$ 93,441$

Total Liabilities 12,513$ 14,255$ 17,859$ 21,394$ 21,504$ 20,154$ 31,238$ 37,635$ 42,401$ 44,094$ 40,527$

Retained Earnings 18,812$ 23,066$ 26,571$ 30,503$ 35,223$ 41,471$ 49,290$ 55,280$ 63,379$ 70,306$ 73,184$

EBITDA 7,992$ 9,490$ 11,340$ 12,740$ 14,987$ 15,464$ 15,886$ 17,990$ 19,001$ 19,437$ 5,501$

Market Value of Equity 102,068$ 147,911$ 133,395$ 129,524$ 169,852$ 153,871$ 174,836$ 168,651$ 144,707$ 162,920$ 162,920$

Net Sales 29,139$ 33,004$ 36,298$ 41,862$ 47,348$ 50,514$ 53,324$ 61,095$ 63,747$ 61,897$ 15,631$

Normal Altman Z Score 7.82 9.06 7.45 6.49 7.78 7.72 5.90 5.28 4.77 4.81 4.13

Revised Altman Z Score 13.98 16.28 13.12 11.49 13.98 14.26 10.02 9.24 8.57 8.91 8.60

X1 0.19 0.22

X2 0.74 0.78

X3 0.21 0.06

X4 3.69 4.02

X5 0.65 0.17

Altman Z Score

Annual

4.81 4.13

Revised Altman Z Score

Annual

The Z-score formula may be used to predict the probability that a firm will go into bankruptcy within two years.

Z-scores are used to predict corporate defaults and an easy-to-calculate control measure for the financial distress status of companies in academic studies. The Z-score uses multiple

corporate income and balance sheet values to measure the financial health of a company.

The main problem with the Altman Z formula is that the formula is not suited for many industries. Industries that operate with high leverage, such as radio and utilities will show a

higher risk of bankruptcy.

Also, industries with negative working capital, such as many retail and restaurant companies will also exhibit the same high level of bankruptcy.

(Wikipedia http://en.wikipedia.org/wiki/Z-Score_Financial_Analysis_Tool)

Z = 1.2*X1 + 1.4*X2 + 3.3*X3 + 0.6*X4 + 1.0*X5

There is also a revised Altman Z score which is adjusted for non manufacturing corporations. The revised formula is:

Z = 6.56*X1 + 3.26*X2 + 6.72*X3 + 1.05*X4

X1 = Working Capital/Total Assets

MRQ Edit

Piotroski Score

Annual MRQ

8.91 8.60

X2 = Retained Earnings/Total Assets

X3 = EBITDA/Total Assets

X4 = Market Value of Equity/Total Liabilities

X5 = Net Sales/Total Assets

Altman Z Score

A discrete score between 0-9 which reflects nine criteria used to determine the strength of a firm's financial position. The Piotroski score is used to determine the best value stocks,

nine being the best. The score was named after Chicago Accounting Professor, Joseph Piotroski who devised the scale according to specific criteria found in the financial statements.

For every criteria (below) that is met the company is given one point, if it is not met, then no points are awarded. The points are then added up to determine the best value stocks.

Profitability

* Positive return on assets in the current year (1 point)

* Positive operating cash flow in the current year (1 point)

* Higher return on assets (ROA) in the current period compared to the ROA in the previous year (1 point)

* Cash flow from operations are greater than ROA (1 point)

Leverage, Liquidity and Source of Funds

* Lower ratio of long term debt to in the current period compared value in the previous year (1 point)

* Higher current ratio this year compared to the previous year (1 point)

* No new shares were issued in the last year (1 point)

Operating Efficiency

* A higher gross margin compared to the previous year (1 point)

* A higher asset turnover ratio compared to the previous year (1 point)

MRQ

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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

M Score - 5 Variable NA -2.77 -2.81 -2.74 -2.96 -2.95 -2.24 -2.90 -2.94 -2.91 -2.88

M Score - 8 Variable NA -2.71 -2.59 -2.61 -2.68 -2.54 -2.20 -2.75 -2.60 -2.65 -2.62

DSRI 0.92 1.06 1.06 0.92 0.96 1.18 0.95 0.99 1.02 1.03 0.00

GMI 1.05 1.00 1.00 0.99 0.99 1.01 1.01 1.00 1.01 1.00 0.00

AQI 1.12 0.97 1.03 0.91 0.93 1.80 0.93 0.94 1.00 1.01 0.00

SGI 1.13 1.10 1.15 1.13 1.07 1.06 1.15 1.04 0.97 1.01 0.00

DEPI 1.04 1.07 1.00 0.94 1.04 1.13 0.87 0.99 1.04 0.96 0.00

SGAI 0.97 0.93 1.00 0.99 1.00 0.98 1.02 1.01 0.95 1.00 0.00

TATA -0.08 -0.04 -0.07 -0.05 -0.03 -0.05 -0.06 -0.02 -0.05 -0.04 0.00

LVGI 0.91 1.25 1.02 0.91 0.82 1.19 1.11 1.03 0.93 0.90 0.00

Revised Altman Z Score

When Z is 3.0 or more, the firm is most likely safe based on the financial data. However, be careful to double check as fraud, economic downturns and other

factors could cause unexpected reversals.

When Z is 2.7 to 3.0, the company is probably safe from bankruptcy, but this is in the grey area and caution should be taken.

When Z is 1.8 to 2.7, the company is likely to be bankrupt within 2 years. This is the lower portion of the grey area and a dramatic turnaround of the company is

needed.

When Z is below 1.8, the company is highly likely to be bankrupt. If a company is generating lower than 1.8, serious studies must be performed to ensure the

company can survive.

The Beneish Model - M Score VariablesDSRI = Days' Sales in Receivables Index. Measured as the ratio of days' sales in receivables in year t to year t-1. A large increase in DSR could be indicative of revenue inflation.

GMI = Gross Margin Index. Measured as the ratio of gross margin in year t-1 to gross margin in year t. Gross margin has deteriorated when this index is above 1. A firm with poorer

prospects is more likely to manipulate earnings.

AQI = Asset Quality Index. Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.AQI is the ratio of asset quality in year t

to year t-1.

SGI = Sales Growth Index. Ratio of sales in year t to sales in year t-1. Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves

under pressure to manipulate in order to keep up appearances.

DEPI = Depreciation Index. Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t. DEPI greater than 1 indicates that assets are being

depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

SGAI = Sales, General and Administrative expenses Index. The ratio of SGA expenses in year t relative to year t -1.

LVGI = Leverage Index. The ratio of total debt to total assets in year t relative to yeat t-1. An LVGI >1 indicates an increase in leverage

TATA - Total Accruals to Total Assets. Total accruals calculated as the change in working capital accounts other than cash less depreciation.

The Beneish M Score FormulaThe eight variables are then weighted together according to the following:

M = -4.84 + 0.92*DSRI + 0.528*GMI + 0.404*AQI + 0.892*SGI + 0.115*DEPI - 0.172*SGAI + 4.679*TATA - 0.327*LVGI

A score greater than -2.22 indicates a strong likelihood of a firm being a manipulator. In his out of sample tests, Beneish found that he could correctly identify 76% of manipulators,

whilst only incorrectly identifying 17.5% of non-manipulators.

The 5 Variable Version of the Beneish ModelThe five variable version excludes SGAI, DEPI and LEVI which were not significant in the original Beneish model.

M = -6.065 + 0.823*DSRI + 0.906*GMI + 0.593*AQI + 0.717*SGI + 0.107*DEPI

A score greater than -2.22 indicates a strong likelihood of a firm being a manipulator.

Original Altman Z Score

When Z is 2.6 or more, the firm is most likely safe based on the financial data. However, be careful to double check as fraud, economic downturns and other factors could cause

unexpected reversals.

When Z is 1.1 to 2.6, the company is probably safe from bankruptcy, but this is in the grey area and caution should be taken.

When Z is below 1.1, the company is highly likely to be bankrupt. If a company is generating lower than 1.8, serious studies must be performed to ensure the company can survive.

Johnson & Johnson

(JNJ)7/2/2010

JNJ PFE ABT MRK GSK BSX

Sorted Data JNJ ABT PFE GSK MRK BSX

Stock Price $ 59.07 $ 46.46 $ 14.23 $ 33.92 $ 34.44 $ 5.90 |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||| |||||||||||||| ||||||||||||||||||||||||||||||||| |||||||||||||||||||||||||||||||||| |||||

Mkt Cap ($M) $ 162,920.00 $ 71,710.00 $ 114,780.00 $ 88,070.00 $ 107,390.00 $ 8,950.00 |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>>

EV $ 158,540.00 $ 88,480.00 $ 146,160.00 $ 102,680.00 $ 121,400.00 $ 14,580.00 |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>>

52 Wk High $ 66.20 $ 56.79 $ 20.36 $ 43.47 $ 41.56 $ 11.77 |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||| ||||||||||||||||||||||||||||||||||||||||||| ||||||||||||||||||||||||||||||||||||||||| |||||||||||

52 Wk Low $ 55.71 $ 43.45 $ 14.00 $ 32.15 $ 25.05 $ 5.41 |||||||||||||||||||||||||||||||||||||||||||||||||| >>> ||||||||||||||||||||||||||||||||||||||||||| |||||||||||||| |||||||||||||||||||||||||||||||| ||||||||||||||||||||||||| |||||

% off 52Wk Low 6.0% 6.9% 1.6% 5.5% 37.5% 9.1%

MultiplesP/E(TTM) 12.4 13.6 11.5 10.0 7.3 0.0 |||||||||||| ||||||||||||| ||||||||||| |||||||||| |||||||

P/S(TTM) 2.6 2.3 2.1 2.0 3.3 1.1 || || || || ||| |

P/Tang BV(MRQ) 7.7 0.0 0.0 0.0 2,947.2 0.0 ||||||| |||||||||||||||||||||||||||||||||||||||||||||||||| >>>

P/CF 10.1 9.6 8.4 8.0 6.9 0.0 |||||||||| ||||||||| |||||||| ||||||| ||||||

P/FCF(TTM) 16.8 15.8 118.7 17.2 0.0 0.0 |||||||||||||||| ||||||||||||||| |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||

EV/EBITDA(TTM) 8.0 9.6 6.2 6.2 13.0 7.1 |||||||| ||||||||| |||||| |||||| |||||||||||| |||||||

DividendsDiv Yld 2.0% 1.6% 0.7% 5.4% 4.4% 0.0% || |

Div Yld - 5yr avg 2.6% 2.6% 4.6% 0.0% 3.8% 0.0% || ||

Div 5yr Grth 12.0% 9.0% 3.8% 7.8% 0.4% 0.0% |||||||||||| |||||||||

Payout Ratio(TTM) 40.7% 47.8% 66.6% 54.9% 33.8% 0.0% |||||||||||||||||||||||||||||||||||||||| |||||||||||||||||||||||||||||||||||||||||||||||

Growth RatesSales(MRQ) v 1yr ago 4.0% 14.6% 54.1% 8.7% 112.1% -2.5% |||| |||||||||||||| | ||

Sales(TTM) v 1yr ago 2.6% 2.3% 2.1% 2.0% 3.3% 1.1% || ||

Sales 5yr Grth 5.5% 9.4% 0.4% 7.3% 3.6% 7.8% ||||| |||||||||

EPS(MRQ) v 1yr ago 28.7% -30.5% -38.1% 17.6% -85.9% -12043.4% |||||||||||||||||||||||||||| |||||||||||||||||||||||||||||| |||||||||||||||||||||||||||||||||||||| <<< |||||||||||||||||||||||||||||||||||||||||||||||||| <<< ||||||||||||||||||||||||||||||||||||||||||||||||||

EPS(TTM) v 1yr ago 4.3% 1.7% 5.4% 30.9% 72.4% -8.9% |||| | ||||||||

EPS 5yr Grth 9.9% 12.8% -3.1% 17.9% 16.6% 0.0% ||||||||| |||||||||||| |||

Balance SheetQuick Ratio(MRQ) 1.8 0.9 1.5 1.2 1.3 1.0 | | | |

Current Ratio(MRQ) 2.1 1.2 1.9 1.5 1.7 1.3 || | | | | |

LTD/Eq(MRQ) 15.2 52.2 42.7 142.6 26.4 52.6 ||||||||||||||| |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||| |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||| |||||||||||||||||||||||||||||||||||||||||||||||||| >>>

Tot D/Eq(MRQ) 22.9 83.1 51.4 152.3 33.4 54.9 |||||||||||||||||||||| |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>> ||||||||||||||||||||||||||||||||| |||||||||||||||||||||||||||||||||||||||||||||||||| >>>

MarginsGross %(TTM) 70.0% 57.1% 78.9% 73.9% 61.1% 67.7% |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>>

Gross % 5yr 71.2% 56.0% 82.2% 76.6% 73.5% 71.6% |||||||||||||||||||||||||||||||||||||||||||||||||| >>> |||||||||||||||||||||||||||||||||||||||||||||||||| >>>

Op %(TTM) 27.8% 20.9% 18.3% 30.4% 42.2% -29.4% ||||||||||||||||||||||||||| |||||||||||||||||||| |||||||||||||||||||||||||||||

Op % 5yr avg 25.4% 18.4% 22.1% 31.4% 35.2% -11.3% ||||||||||||||||||||||||| |||||||||||||||||| |||||||||||

Net %(TTM) 21.3% 16.7% 14.2% 20.4% 35.6% -32.0% ||||||||||||||||||||| |||||||||||||||| |||||||||||||||||||||||||||||||

Net % 5yr avg 19.6% 14.6% 18.0% 21.6% 27.8% -16.8% ||||||||||||||||||| |||||||||||||| ||||||||||||||||

ReturnsROA(TTM) 14.8% 10.8% 5.0% 14.1% 15.1% -10.6% |||||||||||||| |||||||||| ||||||||||

ROA 5yr avg 15.4% 10.2% 7.0% 16.7% 12.7% -5.7% ||||||||||||||| |||||||||| |||||

ROE(TTM) 27.5% 27.4% 10.6% 61.3% 30.3% -21.6% ||||||||||||||||||||||||||| ||||||||||||||||||||||||||| |||||||||||||||||||||

ROE 5yr avg 27.8% 23.2% 12.9% 60.4% 29.8% -11.6% ||||||||||||||||||||||||||| ||||||||||||||||||||||| |||||||||||

EfficiencyRec Turnover(TTM) 6.3 5.4 4.8 4.6 6.1 6.1 |||||| ||||| |||| |||| |||||| ||||||

Inv Turnover(TTM) 3.5 4.1 1.6 1.8 2.9 3.0 ||| |||| | | || ||

Asset Turnover(TTM) 0.7 0.6 0.4 0.7 0.4 0.3

GSK MRK BSX

P/CFEnter Competitor Tickers

JNJ ABT PFE

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Johnson & Johnson

Figures in Millions except per share values

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

$4,917.0 $7,133.0 $6,077.0 $8,333.0 $8,956.0 $9,245.0 ####### ####### ####### ####### ####### $4,669.0 $5,542.0 $6,160.0 $6,804.0 $8,458.0 $9,872.0 ####### ####### ####### ####### #######

% Change 45.1% -14.8% 37.1% 7.5% 3.2% 24.5% 3.7% -0.3% 19.3% 6.3% % Change 18.7% 11.2% 10.5% 24.3% 16.7% 6.3% -4.3% 26.6% -0.3% 8.8%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

$36.7 $48.5 $44.9 $43.6 $57.2 $51.7 $60.4 $59.4 $52.3 $62.7 $59.1 $1.70 $1.84 $2.16 $2.40 $2.84 $3.46 $3.73 $3.63 $4.57 $4.40 $1.15

% Change 32.3% -7.4% -2.9% 31.0% -9.5% 16.8% -1.7% -11.9% 19.9% -5.8% % Change 8.2% 17.4% 11.1% 18.3% 21.8% 7.8% -2.7% 25.9% -3.7% -73.9%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

16.9% 21.6% 16.7% 19.9% 18.9% 18.3% 21.6% 19.5% 18.7% 23.0% 24.2% 20.8 20.7 22.0 15.5 19.0 16.6 15.2 14.1 12.2 12.2 10.8

% Change 28.1% -22.5% 18.9% -5.0% -3.2% 17.9% -9.5% -4.4% 22.9% 5.3% % Change -0.1% 5.9% -29.2% 22.0% -12.2% -8.7% -7.0% -14.0% 0.1% -11.4%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

29.1% 33.4% 30.6% 35.8% 32.5% 27.8% 50.7% 36.9% 32.7% 34.0% 35.0% 4.8% 4.8% 4.6% 6.4% 5.3% 6.0% 6.6% 7.1% 8.2% 8.2% 9.3%

% Change 14.9% -8.3% 17.0% -9.2% -14.4% 82.1% -27.2% -11.3% 3.9% 2.9% % Change 0.1% -5.5% 41.2% -18.0% 13.9% 9.6% 7.5% 16.2% -0.1% 12.8%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

8.0% 6.7% 8.9% 10.4% 9.4% 11.1% 9.0% 10.7% 13.2% 12.0% 12.8% 62.9% 60.5% 70.1% 65.8% 64.3% 57.3% 92.7% 76.6% 69.9% 56.9% 60.7%

% Change -16.6% 32.8% 16.9% -9.3% 17.8% -19.0% 18.9% 24.1% -9.0% 6.6% % Change -3.8% 15.8% -6.1% -2.3% -10.8% 61.7% -17.5% -8.7% -18.7% 6.8%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

74.8% 71.1% 71.2% 70.9% 71.7% 72.4% 71.8% 70.9% 71.0% 70.2% 70.0% 16.5% 17.2% 18.2% 17.2% 18.0% 20.6% 20.7% 17.3% 20.3% 19.8% 21.3%

% Change -4.9% 0.2% -0.4% 1.0% 1.0% -0.8% -1.1% 0.0% -1.1% -0.2% % Change 4.3% 5.8% -5.4% 4.5% 14.7% 0.6% -16.5% 17.3% -2.4% 7.3%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

5.0 5.0 8.0 5.0 9.0 7.0 5.0 5.0 7.0 6.0 7.0 7.8 9.1 7.4 6.5 7.8 7.7 5.9 5.3 4.8 4.8 4.1

% Change 0.0% 60.0% -37.5% 80.0% -22.2% -28.6% 0.0% 40.0% -14.3% 16.7% % Change 15.8% -17.8% -12.8% 19.8% -0.8% -23.6% -10.5% -9.6% 0.8% -14.2%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

-2.7 -2.6 -2.6 -2.7 -2.5 -2.2 -2.7 -2.6 -2.7 -2.6 27.5% 28.2% 29.0% 30.2% 33.7% 23.8% 24.2% 20.4% 23.5% 22.1% 23.6%

% Change #DIV/0! 4.5% -1.0% -2.7% 5.4% 13.6% -25.1% 5.3% -2.0% 1.4% % Change 2.6% 2.7% 4.1% 11.7% -29.5% 2.0% -15.9% 15.4% -5.8% 6.6%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

66.5% 58.8% 78.7% 79.6% 67.6% 53.2% 79.4% 86.9% 99.7% 87.2% 76.6% 39.3% 50.0% 34.0% 39.0% 41.6% 45.9% 36.8% 31.7% 28.1% 32.2% 37.3%

% Change -11.6% 33.8% 1.2% -15.1% -21.3% 49.3% 9.4% 14.8% -12.6% -12.1% % Change 27.3% -32.0% 14.5% 6.9% 10.1% -19.7% -13.9% -11.5% 14.7% 15.7%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 TTM

332.5% 1262.5% 287.1% 731.6% 3198.6% 1384.0% 251.4% 484.7% 319.0% 224.8% 373.6% 241.4% 321.7% 300.5% 282.0% 349.2% 458.4% 571.5% 168.8% 146.6% 172.8% 187.5%

% Change 279.7% -77.3% 154.9% 337.2% -56.7% -81.8% 92.8% -34.2% -29.5% 66.1% % Change 33.3% -6.6% -6.2% 23.8% 31.3% 24.7% -70.5% -13.1% 17.8% 8.5%

Magic Formula Investing -- Earnings Yield Magic Formula Investing -- Return on Capital

FCF to Short Term Debt FCF to Long Term Debt

Gross Margin Net Profit Margin

Piotroski F score

Debt to Equity FCF to Total Debt

Original Altman Z Score

Beneish M Score - 8 Variable Version Tax Rate

(JNJ)7/2/2010

Diluted EPS

FCF / Sales Price / FCF

Cash Return on Invested Capital (CROIC) FCF Yield

Owner EarningsFree Cash Flow

Stock Price

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