Stock Analysis on Net

Johnson & Johnson (NYSE:JNJ)

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Analysis of Income Taxes

Microsoft Excel

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Income Tax Expense (Benefit)

Johnson & Johnson, income tax expense (benefit), continuing operations

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
U.S. taxes
International taxes
Currently payable
U.S. taxes
International taxes
Deferred
Provision for taxes on income

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

Item Description The company
Currently payable Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. Johnson & Johnson currently payable increased from 2021 to 2022 and from 2022 to 2023.
Deferred Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Johnson & Johnson deferred increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.
Provision for taxes on income Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Johnson & Johnson provision for taxes on income increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.

Effective Income Tax Rate (EITR)

Johnson & Johnson, effective income tax rate (EITR) reconciliation

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
U.S. statutory tax rate
International operations
U.S. Tax Settlements
Consumer health separation
U.S. taxes on international income
Tax benefits from loss on capital assets
Tax benefits on share-based compensation
All other
Effective tax rate

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

Item Description The company
Effective tax rate Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Johnson & Johnson effective tax rate increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.

Components of Deferred Tax Assets and Liabilities

Johnson & Johnson, components of deferred tax assets and liabilities

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
Employee related obligations
Stock based compensation
Depreciation & amortization
R&D capitalized for tax
Reserves & liabilities
Income reported for tax purposes
Net realizable operating loss carryforward
Undistributed foreign earnings
Miscellaneous international
Miscellaneous U.S.
Deferred tax assets
Depreciation of property, plant and equipment
Goodwill and intangibles
Non-deductible intangibles
Undistributed foreign earnings
Global intangible low-taxed income
Miscellaneous international
Miscellaneous U.S.
Deferred tax liabilities
Deferred income taxes

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

Item Description The company
Deferred tax assets Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Johnson & Johnson deferred tax assets increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.
Deferred income taxes Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. Johnson & Johnson deferred income taxes increased from 2021 to 2022 and from 2022 to 2023.

Deferred Tax Assets and Liabilities, Classification

Johnson & Johnson, deferred tax assets and liabilities, classification

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
Deferred tax assets
Deferred tax liabilities

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

Item Description The company
Deferred tax assets Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent. Johnson & Johnson deferred tax assets decreased from 2021 to 2022 but then slightly increased from 2022 to 2023.
Deferred tax liabilities Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent. Johnson & Johnson deferred tax liabilities decreased from 2021 to 2022 and from 2022 to 2023.

Adjustments to Financial Statements: Removal of Deferred Taxes

Johnson & Johnson, adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
Adjustment to Total Assets
Total assets (as reported)
Less: Noncurrent deferred tax assets, net
Total assets (adjusted)
Adjustment to Total Liabilities
Total liabilities (as reported)
Less: Noncurrent deferred tax liabilities, net
Total liabilities (adjusted)
Adjustment to Shareholders’ Equity
Shareholders’ equity (as reported)
Less: Net deferred tax assets (liabilities)
Shareholders’ equity (adjusted)
Adjustment to Net Earnings
Net earnings (as reported)
Add: Deferred income tax expense (benefit)
Net earnings (adjusted)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).


Johnson & Johnson, Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Johnson & Johnson, adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
Net Profit Margin
Reported net profit margin
Adjusted net profit margin
Total Asset Turnover
Reported total asset turnover
Adjusted total asset turnover
Financial Leverage
Reported financial leverage
Adjusted financial leverage
Return on Equity (ROE)
Reported ROE
Adjusted ROE
Return on Assets (ROA)
Reported ROA
Adjusted ROA

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Johnson & Johnson adjusted net profit margin ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Johnson & Johnson adjusted total asset turnover ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Johnson & Johnson adjusted financial leverage ratio decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Johnson & Johnson adjusted ROE deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Johnson & Johnson adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

Johnson & Johnson, Financial Ratios: Reported vs. Adjusted


Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
As Reported
Selected Financial Data (US$ in millions)
Net earnings
Sales to customers
Profitability Ratio
Net profit margin1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net earnings
Sales to customers
Profitability Ratio
Adjusted net profit margin2

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

2023 Calculations

1 Net profit margin = 100 × Net earnings ÷ Sales to customers
= 100 × ÷ =

2 Adjusted net profit margin = 100 × Adjusted net earnings ÷ Sales to customers
= 100 × ÷ =

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Johnson & Johnson adjusted net profit margin ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
As Reported
Selected Financial Data (US$ in millions)
Sales to customers
Total assets
Activity Ratio
Total asset turnover1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Sales to customers
Adjusted total assets
Activity Ratio
Adjusted total asset turnover2

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

2023 Calculations

1 Total asset turnover = Sales to customers ÷ Total assets
= ÷ =

2 Adjusted total asset turnover = Sales to customers ÷ Adjusted total assets
= ÷ =

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Johnson & Johnson adjusted total asset turnover ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets
Shareholders’ equity
Solvency Ratio
Financial leverage1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted total assets
Adjusted shareholders’ equity
Solvency Ratio
Adjusted financial leverage2

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

2023 Calculations

1 Financial leverage = Total assets ÷ Shareholders’ equity
= ÷ =

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted shareholders’ equity
= ÷ =

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Johnson & Johnson adjusted financial leverage ratio decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
As Reported
Selected Financial Data (US$ in millions)
Net earnings
Shareholders’ equity
Profitability Ratio
ROE1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net earnings
Adjusted shareholders’ equity
Profitability Ratio
Adjusted ROE2

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

2023 Calculations

1 ROE = 100 × Net earnings ÷ Shareholders’ equity
= 100 × ÷ =

2 Adjusted ROE = 100 × Adjusted net earnings ÷ Adjusted shareholders’ equity
= 100 × ÷ =

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Johnson & Johnson adjusted ROE deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 29, 2019
As Reported
Selected Financial Data (US$ in millions)
Net earnings
Total assets
Profitability Ratio
ROA1
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net earnings
Adjusted total assets
Profitability Ratio
Adjusted ROA2

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-29).

2023 Calculations

1 ROA = 100 × Net earnings ÷ Total assets
= 100 × ÷ =

2 Adjusted ROA = 100 × Adjusted net earnings ÷ Adjusted total assets
= 100 × ÷ =

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Johnson & Johnson adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.