Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Johnson & Johnson (NYSE:JNJ)

Analysis of Operating Leases

Advanced level

Present Value of Future Operating Lease Payments (before Adoption of FASB Topic 842)

Johnson & Johnson, future operating lease payments (before adoption of FASB Topic 842)

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 29, 2019 Dec 30, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Total undiscounted future operating lease payments 896  839  822  827 
Discount rate1 3.19% 3.19% 3.33% 4.06%
 
Total present value of future operating lease payments 814  766  747  737 

Based on: 10-K (filing date: 2020-02-18), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-21), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-24).

1 Weighted-average interest rate for Johnson & Johnson’s debt

Year Future operating lease payments (as reported) Year Future operating lease payments (estimated) Present value at 3.19%
2019 223  2019 223  216 
2020 188  2020 188  177 
2021 154  2021 154  140 
2022 116  2022 116  102 
2023 76  2023 76  65 
2024 and thereafter 139  2024 76  63 
2025 63  51 
Total: 896  896  814 

Based on: 10-K (filing date: 2019-02-20).

Year Future operating lease payments (as reported) Year Future operating lease payments (estimated) Present value at 3.19%
2018 227  2018 227  220 
2019 184  2019 184  173 
2020 143  2020 143  130 
2021 106  2021 106  93 
2022 76  2022 76  65 
2023 and thereafter 103  2023 76  63 
2024 27  22 
Total: 839  839  766 

Based on: 10-K (filing date: 2018-02-21).

Year Future operating lease payments (as reported) Year Future operating lease payments (estimated) Present value at 3.33%
2017 216  2017 216  209 
2018 179  2018 179  168 
2019 134  2019 134  121 
2020 105  2020 105  92 
2021 88  2021 88  75 
2022 and thereafter 100  2022 88  72 
2023 12  10 
Total: 822  822  747 

Based on: 10-K (filing date: 2017-02-27).

Year Future operating lease payments (as reported) Year Future operating lease payments (estimated) Present value at 4.06%
2016 224  2016 224  215 
2017 194  2017 194  179 
2018 136  2018 136  121 
2019 90  2019 90  77 
2020 74  2020 74  61 
2021 and thereafter 109  2021 74  58 
2022 35  26 
Total: 827  827  737 

Based on: 10-K (filing date: 2016-02-24).


Adjustments to Financial Statements for Operating Leases

Johnson & Johnson, adjustments to financial statements

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 29, 2019 Dec 30, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Adjustment to Total Assets
Total assets (as reported) 157,728  152,954  157,303  141,208  133,411 
Add: Operating lease right-of-use asset (before adoption of FASB Topic 842)1 —  814  766  747  737 
Total assets (adjusted) 157,728  153,768  158,069  141,955  134,148 
Adjustment to Total Debt
Total debt (as reported) 27,696  30,480  34,581  27,126  19,861 
Add: Operating lease liability (before adoption of FASB Topic 842)2 —  814  766  747  737 
Add: Current operating lease liabilities 269  —  —  —  — 
Add: Non-current operating lease liabilities 716  —  —  —  — 
Total debt (adjusted) 28,681  31,294  35,347  27,873  20,598 

Based on: 10-K (filing date: 2020-02-18), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-21), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-24).

1, 2 Equal to total present value of future operating lease payments.


Johnson & Johnson, Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios for Operating Leases (Summary)

Johnson & Johnson, adjusted financial ratios

Microsoft Excel LibreOffice Calc
Dec 29, 2019 Dec 30, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Total Asset Turnover1
Reported total asset turnover 0.52 0.53 0.49 0.51 0.53
Adjusted total asset turnover 0.52 0.53 0.48 0.51 0.52
Debt to Equity2
Reported debt to equity 0.47 0.51 0.57 0.39 0.28
Adjusted debt to equity 0.48 0.52 0.59 0.40 0.29
Return on Assets3 (ROA)
Reported ROA 9.59% 10.00% 0.83% 11.71% 11.55%
Adjusted ROA 9.59% 9.95% 0.82% 11.65% 11.49%

Based on: 10-K (filing date: 2020-02-18), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-21), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-24).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Johnson & Johnson’s adjusted total asset turnover ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.
Adjusted debt to equity A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity. Johnson & Johnson’s adjusted debt to equity ratio improved from 2017 to 2018 and from 2018 to 2019.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Johnson & Johnson’s adjusted ROA improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.

Johnson & Johnson, Financial Ratios: Reported vs. Adjusted


Adjusted Total Asset Turnover

Microsoft Excel LibreOffice Calc
Dec 29, 2019 Dec 30, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Sales to customers 82,059  81,581  76,450  71,890  70,074 
Total assets 157,728  152,954  157,303  141,208  133,411 
Activity Ratio
Total asset turnover1 0.52 0.53 0.49 0.51 0.53
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Sales to customers 82,059  81,581  76,450  71,890  70,074 
Adjusted total assets 157,728  153,768  158,069  141,955  134,148 
Activity Ratio
Adjusted total asset turnover2 0.52 0.53 0.48 0.51 0.52

Based on: 10-K (filing date: 2020-02-18), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-21), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-24).

2019 Calculations

1 Total asset turnover = Sales to customers ÷ Total assets
= 82,059 ÷ 157,728 = 0.52

2 Adjusted total asset turnover = Sales to customers ÷ Adjusted total assets
= 82,059 ÷ 157,728 = 0.52

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Johnson & Johnson’s adjusted total asset turnover ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.

Adjusted Debt to Equity

Microsoft Excel LibreOffice Calc
Dec 29, 2019 Dec 30, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Total debt 27,696  30,480  34,581  27,126  19,861 
Shareholders’ equity 59,471  59,752  60,160  70,418  71,150 
Solvency Ratio
Debt to equity1 0.47 0.51 0.57 0.39 0.28
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Adjusted total debt 28,681  31,294  35,347  27,873  20,598 
Shareholders’ equity 59,471  59,752  60,160  70,418  71,150 
Solvency Ratio
Adjusted debt to equity2 0.48 0.52 0.59 0.40 0.29

Based on: 10-K (filing date: 2020-02-18), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-21), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-24).

2019 Calculations

1 Debt to equity = Total debt ÷ Shareholders’ equity
= 27,696 ÷ 59,471 = 0.47

2 Adjusted debt to equity = Adjusted total debt ÷ Shareholders’ equity
= 28,681 ÷ 59,471 = 0.48

Solvency ratio Description The company
Adjusted debt-to-equity A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity. Johnson & Johnson’s adjusted debt-to-equity ratio improved from 2017 to 2018 and from 2018 to 2019.

Adjusted Return on Assets (ROA)

Microsoft Excel LibreOffice Calc
Dec 29, 2019 Dec 30, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Net earnings 15,119  15,297  1,300  16,540  15,409 
Total assets 157,728  152,954  157,303  141,208  133,411 
Profitability Ratio
ROA1 9.59% 10.00% 0.83% 11.71% 11.55%
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Net earnings 15,119  15,297  1,300  16,540  15,409 
Adjusted total assets 157,728  153,768  158,069  141,955  134,148 
Profitability Ratio
Adjusted ROA2 9.59% 9.95% 0.82% 11.65% 11.49%

Based on: 10-K (filing date: 2020-02-18), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-21), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-24).

2019 Calculations

1 ROA = 100 × Net earnings ÷ Total assets
= 100 × 15,119 ÷ 157,728 = 9.59%

2 Adjusted ROA = 100 × Net earnings ÷ Adjusted total assets
= 100 × 15,119 ÷ 157,728 = 9.59%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Johnson & Johnson’s adjusted ROA improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.