What Can Trigger Johnson & Johnson Stock’s Slide?
Johnson & Johnson (JNJ) is facing threats. Even the biggest names aren’t invincible. Stocks can drop sharply without warning, wiping out months or years of gains in a matter of weeks. History shows that sudden market swings can hit any company, no matter how dominant it seems.
The Risk That Is Brewing
- Talc Crisis Deepens: 73,570 lawsuits by Oct 2025, up 17% from Dec 2024. A $966 million verdict was issued in Oct 2025. Failed $8-10 billion settlement offers add uncertainty as J&J now litigates cases individually.
- Stelara Revenue Erosion: Sales fell 40% in the first nine months of 2025. Q1 2025 sales declined 33.7% to $1.08 billion. Eight biosimilars are expected by 2025, and a 66% IRA price cut is mandated by 2026.
- Emerging Product Liability: Post-Kenvue spin-off, J&J faces UK talc lawsuits alongside Kenvue, plus new claims like Tylenol issues for Kenvue. Broadening liability scope and regulatory pressure remain risks.
No matter where one stock goes, your portfolio should stay on track. See how High Quality Portfolio can help you do that.
Is Risk Showing Up In Financials Yet?
- Which Is A Better Pick: Johnson & Johnson or Pfizer Stock?
- Johnson & Johnson Stock Capital Return Hits $157 Bil
- Johnson & Johnson Stock Capital Return Hits $157 Bil
- S&P 500 Stocks Trading At 52-Week High
- Large Cap Stocks Trading At 52-Week High
- ZTS Beats Johnson & Johnson Stock on Both Fronts – Lower Price, Higher Growth
It certainly helps mitigate the risk if the fundamentals check out. For details on JNJ Read Buy or Sell JNJ Stock. Below are a few numbers that matter.
- Revenue Growth: 5.1% LTM and 6.1% last 3-year average.
- Cash Generation: Nearly 20.3% free cash flow margin and 26.2% operating margin LTM.
- Valuation: Johnson & Johnson stock trades at a P/E multiple of 18.2
- Opportunity vs S&P: Compared to S&P, you get lower valuation, higher 3 year average revenue growth, and better margins
| JNJ | S&P Median | |
|---|---|---|
| Sector | Health Care | – |
| Industry | Pharmaceuticals | – |
| PE Ratio | 18.2 | 24.1 |
|
|
||
| LTM* Revenue Growth | 5.1% | 5.3% |
| 3Y Average Annual Revenue Growth | 6.1% | 5.3% |
|
|
||
| LTM* Operating Margin | 26.2% | 18.7% |
| 3Y Average Operating Margin | 26.4% | 17.8% |
| LTM* Free Cash Flow Margin | 20.3% | 13.3% |
*LTM: Last Twelve Months
How Bad Can It Really Get?
When looking at risk for JNJ, it’s clear no stock is immune during big market sell-offs. JNJ fell roughly 35% in both the Dot-Com Bubble and Global Financial Crisis. During the Covid sell-off, it dipped about 27%. Even the less severe events, like the 2018 correction and last year’s inflation shock, triggered declines close to 18%. It shows that even solid companies can take a sizeable hit when markets turn. Quality matters, but downside risk remains real in turbulent times.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.