Is Johnson & Johnson a Good Dividend Stock to Buy Now?

Is Johnson & Johnson Worth Investing in for Dividends at the Present Moment?

Johnson & Johnson (JNJ) recently reported its second-quarter results, showing an increase in sales and a raised sales outlook for the year. Despite a 7.5% decrease in the year to date and a 17% drop from its 2022 all-time high, the company's stock remains a favoured choice for investors seeking steady gains.

In the pharmaceutical sector, J&J's sales grew by 4.9% year over year, despite losing patent-protected market exclusivity for Stelara. The immunosuppressant drug accounted for about 11.7% of total revenue in 2024, making it the biggest patent cliff the company has to deal with at the moment. However, Stelara now accounts for less than 7% of J&J's total revenue, making it easier to overcome losses to biosimilar competition with growing sales of newer products.

One of J&J's newer products, Spravato, saw a 48% increase in sales in the first half of 2025, reaching an annualized $1.5 billion. The antidepressant treatment is showing promising results, providing a positive outlook for the company's pharmaceutical division.

In the MedTech sector, J&J is focusing on the development of new technologies. The company is currently testing its Ottava Robotic Surgical System in clinical trials, with the first cases completed in April. Despite competing with industry giants like Intuitive Surgical, J&J has a chance to gain a significant share of the lucrative surgical robotics space with its resources. Even without any contribution from Ottava, second-quarter MedTech sales rose by 7.3% year over year.

Aging populations in developed nations will need plenty of cardiovascular interventions and hip replacements in the decades ahead, making continued growth in the MedTech sector a reasonable expectation. With its focus on medical technology, J&J is well-positioned to meet this demand.

For investors seeking a dividend payout that grows steadily, J&J is a good choice. The company raised its dividend payout for the 63rd year in a row in April 2025, increasing it by 4.8%. This results in a 3.3% yield at recent prices. However, if rapid principle appreciation is what you're after, it's probably best to keep looking.

In the field of mental health, J&J submitted an application for Caplyta, a treatment for schizophrenia and bipolar depression, to be used for preventing relapses of schizophrenia. In a clinical trial supporting the application, treatment with Caplyta reduced the risk of relapse by 63% compared to the placebo group. An application was submitted by an institution in April 2026 to potentially make Caplyta a popular treatment for preventing schizophrenia recurrences, but the specific institution's name is not provided in available information.

In conclusion, while J&J's stock may have seen a drop from its 2022 peak, the company's focus on drugs and medical technology, combined with its steady dividend payout and promising new products, make it a strong contender in its respective sectors. The company's sales growth in the long run is expected to be in the mid-to-high single-digit percentage range due to its focus on these areas. With the continued development of innovative products like Ottava and Caplyta, J&J is poised to maintain its position as a leader in the healthcare industry.