- It seems that 2007 should be a brighter year for Johnson & Johnson (NYSE JNJ). In 2006 the company faced major drug expirations which dampened revenue growth.
- I really like the Pfizer’s (PFE) consumer business acquisition. Despite having a fairly good product line, Pfizer Inc was a pharmaceutical company that happened to have consumer products which came with the Warner Lambert acquisition. JNJ on the other hand has a culture of running diverse healthcare and consumer businesses.
- It reminds me of 3M Company (NYSE MMM), as there is a synergy between different operating units as they share their R&D findings.
- JNJ has a greater global consumer distribution network than Pfizer, therefore, it will be able to increase sales of PFE’s consumer unit by taking the products to places that they’ve not gone before (sounds Star Treckish, doesn’t it?)
- Abbott Laboratories (ABT) received an incredible price (34 times operating earnings) for its diagnostic unit that was sold to General Electric (NYSE GE) (great job!).
- I always looked at ABT as a mini-JNJ; it is a diversified healthcare company which is not heavily dependent on blockbusters. The company had a good quarter and should have a good next year. It is trading at about 18x earnings, higher valuation than JNJ’s 15x earnings, but it should have a bit higher growth rate.
Please read the following important disclosure here.
Enjoyed this read?
Share it with someone who’d love it too!
New to investing?
Explore these valuable guides to get started.
Value Investing
Student
Curriculum
The 6
Commandments
of Value
Investing
Letter to
a Young
Investor
Related Articles

Current thoughts on Tesla
Tesla market value of $780 billion mostly reflects Elon's future dreams, not car sales. The reality? Only $100-180 billion tied to the actual vehicle business.

Europe Can’t Hide Behind America Anymore
Americans have always outspent Europe on defense, but to be fair, we have a currency advantage. Our military might elevated our currency to reserve status.

IMA’s March 2025 Client Dinner Video
Once a year, my company, IMA, hosts a dinner for our clients. Most of them live outside of Denver—and many outside the U.S.—so this event gives us a rare and meaningful chance to meet face-to-face, often for the first time, and really get to know each other.

The Reputational Bankruptcy of the American Dollar
The US dollar will likely continue to get weaker, which is inflationary for the US. Let me start with some easily identifiable reasons.
0 comments