A wonderful business — priced for growth it hasn't delivered.
A great company, but no margin of safety at this price. Worth watching, not worth buying here.
Current price
$250.61
Market cap ≈ $603B
Intrinsic value
$142
range $102 – $203
Margin of safety
-43%
above fair value
Price today
$251
Fair value
$142
Free cash flow — 5-year history ($B)
What the math is really telling you. Watch whether cash flow is compounding — that, more than any single year, is what a value read hangs on.
The read — lights & verdict
- OvervaluedFair value ~$142 vs $251 — trading 43% above what the math supports.
- Price assumes a big accelerationYou'd need ~12%/yr free-cash-flow growth to justify today's price; it has done 4.7%/yr lately.
- Revenue still growingUp 6.1% last year — demand isn't the problem.
- Cash flow compoundingFree cash flow up ~4.7%/yr — the engine is growing.
- Manageable net debtNet debt of $33B — about 1.7× annual free cash flow. Normal for a mature company.
How this was built. Real figures from Johnson & Johnson's public annual filings and market data. Two-stage DCF: 9% discount rate, 5% free-cash-flow growth for 10 years, 2.5% terminal — the numbers are computed, never AI-guessed. Prices as of the last data refresh.