JOHNSON & JOHNSON

Johnson & Johnson has a robust capital structure with total assets of $200.89 billion and total liabilities of $119.71 billion as of Q1 2026. The company maintains a current ratio of 1.03, indicating a liquidity position that is close to the minimum comfort range. The company's total equity stands at $81.19 billion, with long-term debt at $37.53 billion and short-term debt at $17.46 billion. Johnson & Johnson has $21.69 billion in cash and equivalents, but net cash is negative after subtracting total debt, signaling potential liquidity constraints. In terms of profitability, Johnson & Johnson reported a net income of $5.24 billion in Q1 2026, with a return on equity of 6.45% and a return on assets of 2.61%. These figures are below the cohort medians for the Pharmaceuticals industry, suggesting that the company's profitability and returns are not as strong as its peers. The company's gross profit of $15.96 billion represents 66.3% of its revenue, indicating a relatively stable gross margin. The company's business is diversified across pharmaceuticals, medical devices, and consumer health products. It operates globally, with a significant presence in North America, Europe, and the Asia-Pacific region. The company's growth trajectory has been mixed over the past five years and eight quarters. While revenue increased from $21.89 billion in Q1 2025 to $24.06 billion in Q1 2026, the net income has declined significantly, from $10.99 billion in Q1 2025 to $5.24 billion in Q1 2026. This decline is attributed to higher selling, marketing, and administrative expenses, as well as increased research and development costs. Johnson & Johnson faces several risk factors, including exposure to economic conditions, financial markets, and international operations. The company is vulnerable to inflation, interest rate fluctuations, and currency exchange rate changes, which can impact its revenues and expenses. Additionally, the company is exposed to potential changes in trade laws and policies, which could affect its supply chains and product development. The company also faces risks related to global public health crises, climate change, and geopolitical tensions, which could disrupt its operations and supply chains. Recent events include the adoption of new accounting standards, specifically ASU 2025-07, which affects the treatment of derivatives and revenue contracts. The company also completed its annual impairment assessment of goodwill and indefinite-lived intangible assets in the fiscal fourth quarter of 2025. Management has also engaged in an accelerated share repurchase agreement, which could impact the company's capital structure and shareholder equity.