I suspect many of you hold positions in JNJ and thought this a worthwhile forum discussiion. I'm sure most of you have seen the JNJ news today so I won't repost it here. I VERY often jump on over-reactions in short-term share prices due to temporary bad news. While I have every confidence JNJ is very good long-term, I'm thinking this is bombshell news if the allegations can be proven. If not it is just noise in the end. There is already a $4.9B judgement against them on this very issue. $5B charges like this effect earnings, even for a powerhouse like JNJ with deep pockets. Their legal staff was already too busy as they are a frequent target of litigation.
On a personal note I've held JNJ for decades. It was always a core position. Through blind luck I am out now as I liquidated recently at $138.50 during a brokerage account switch. I thought JNJ overpriced some so sold puts for months trying to get back in at $135 or less. JNJ just kept running and puts always expired worthless. It's hard to be objective here as I love the company. I'd like to think it blows over quickly but I'm not so sure it does if attorneys pile on. If it can be proven they had knowledge of real risk it will be messy for some time.
So what is JNJ worth now in your opinion? Be objective but not fearful because that's what successful investors do. I think it is rational to believe they need earnings growth to support the current PE, even after today's big drop. This may or may not be a significant threat for some time to come.
On a personal note I've held JNJ for decades. It was always a core position. Through blind luck I am out now as I liquidated recently at $138.50 during a brokerage account switch. I thought JNJ overpriced some so sold puts for months trying to get back in at $135 or less. JNJ just kept running and puts always expired worthless. It's hard to be objective here as I love the company. I'd like to think it blows over quickly but I'm not so sure it does if attorneys pile on. If it can be proven they had knowledge of real risk it will be messy for some time.
So what is JNJ worth now in your opinion? Be objective but not fearful because that's what successful investors do. I think it is rational to believe they need earnings growth to support the current PE, even after today's big drop. This may or may not be a significant threat for some time to come.