COMPARISON WITH COMPETITORS
- Johnson & Johnson has 10.29% of its assets in cash and equiv, while Pfizer has only 2.17%
- Johnson & Johnson has 45.13% on current assets, in contrast with Pfizer and Merck range between 26% and 29%
- Most important difference: Percentage of retained earnings, J&J (77.86%), Pfizer (42.99%), and Merck (44.56%).
- J&J and Merck: Cost of goods sold 34.27%, but Pfizer has only 19.75%.
- Similarity among three companies in the percent of COGS and operating expenses relative to sales.
STRENGHTS AND WEAKNESSES
- Strengths: recognition, broad portfolio, financial stability.
- Leader in the industry with sales of more than $70,074 million in contrast to competitors (less than $50,000)
- Financial stability implies better ability to get financing and more investments.
- Weaknesses: strong competition, risk of market fluctuations in the world.
- Strong competition reduces ability of growth in the future
ROA, ROCE, Financial Leverage
"ROA is an indicator of how profitable a company is relative to its total assets"
- Johnson and Johnson ROA: 10.42% in 2013, 12.52% in 2014, and 11.55% in 2015.
"ROCE" is a financial ratio that measures a company's profitability and the efficiency with which its capital is employed"
- Johnson & Johnson ROCE: 18.69% in 2015.
- Compared to competitors: Pfizer and Merck 7.35% in 2015.
- Financial leverage is analyzed with debt/assets ratio, debt/equity ratios, long-term debt/equity.
- Johnson & Johnson: 0.467, 0.875, 0.485 respectively.