Johnson & Johnson (NYSE:JNJ)

Asset Turnover

The reported total asset turnover exhibited a mild increase from 0.47 in 2020 to 0.52 in 2021, followed by a slight decline and stabilization around 0.51 through 2023, then a minor decrease to 0.49 in 2024. The adjusted total asset turnover reflected a similar pattern but consistently remained marginally higher than the reported figures, peaking at 0.55 in 2021 and settling at 0.52 in 2024. This trend suggests relatively consistent asset utilization with slight fluctuations over the five-year span.

Current Ratio

The reported and adjusted current ratios were identical, showing an improvement from 1.21 in 2020 to 1.35 in 2021, a notable decline to 0.99 in 2022, followed by recovery to 1.16 in 2023 and a slight decrease to 1.11 in 2024. This indicates fluctuations in short-term liquidity, with a dip below 1 in 2022 implying potential liquidity stress during that year before partial recovery.

Debt to Equity

The reported debt to equity ratio decreased from 0.56 in 2020 to 0.46 in 2021, increased back to 0.52 in 2022, dropped to 0.43 in 2023, and rose again to 0.51 in 2024. Adjusted figures followed a similar trend but were slightly higher, ending at 0.59 in 2024. This pattern suggests varying leverage levels, with some attempts at deleveraging in 2021 and 2023, but a tendency to increase leverage again by 2024.

Debt to Capital

Similar to debt to equity, the reported debt to capital ratio decreased from 0.36 in 2020 to 0.31 in 2021, rebounded to 0.34 in 2022, dipped to 0.30 in 2023, and increased to 0.34 in 2024. Adjusted ratios were consistently slightly higher, reaching 0.37 in 2024. This illustrates a moderate fluctuation in overall capital structure with periodic reductions in debt weight followed by returns to higher debt levels.

Financial Leverage

Reported financial leverage declined steadily from 2.76 in 2020 to 2.44 in 2022 and 2023, before a small rise to 2.52 in 2024. Adjusted financial leverage mirrored this trend, decreasing from 2.68 to 2.40 by 2022, then increasing to 2.67 by 2024. This indicates an initial effort to reduce leverage, followed by increased leverage towards the end of the period.

Net Profit Margin

The reported net profit margin showed growth from 17.82% in 2020 to 22.26% in 2021, declined to 18.90% in 2022, surged sharply to 41.28% in 2023, and fell significantly to 15.84% in 2024. Adjusted margins followed a somewhat similar path but showed a notable drop to 5.31% in 2023 instead of the reported spike, then rose moderately to 14.26% in 2024. This discrepancy suggests anomalies or extraordinary items affecting reported profit margins in 2023, with underlying profitability being much lower.

Return on Equity (ROE)

Reported ROE increased from 23.25% in 2020 to 28.20% in 2021, then declined to 23.36% in 2022, peaked dramatically at 51.11% in 2023, and dropped to 19.68% in 2024. Adjusted ROE followed a similar trajectory but demonstrated a less pronounced peak at 7.20% in 2023, recovering to 19.91% in 2024. This indicates the presence of irregular gains or one-time factors inflating reported equity returns in 2023, with adjusted figures showing much more moderated profitability.

Return on Assets (ROA)

The reported ROA rose from 8.41% in 2020 to 11.47% in 2021, then declined to 9.57% in 2022, experienced a large increase to 20.98% in 2023, and fell back to 7.81% in 2024. Adjusted ROA followed a pattern of growth to 12.16% in 2021, declining to 9.16% in 2022, dropping sharply to 2.85% in 2023, and partially recovering to 7.46% in 2024. This suggests that the significant increase in reported ROA during 2023 was not supported by operational performance, indicating impact from non-recurring items or accounting adjustments.

The financial data reveals several notable trends over the five-year period. Sales to customers exhibit an overall upward movement with some fluctuations. Sales increased from US$82,584 million in 2020 to a peak of US$94,943 million in 2022, before experiencing a decline in 2023 to US$85,159 million. The sales figure partially recovered in 2024, reaching US$88,821 million, yet remaining below the 2022 high.

Total assets display a general growth trend from 2020 through 2022, rising from US$174,894 million to US$187,378 million. However, this trend reversed in 2023, with total assets decreasing to US$167,558 million, followed by a rebound to US$180,104 million in 2024. The adjusted total assets follow a similar trajectory, starting at US$166,653 million in 2020 and increasing to US$178,458 million in 2022, then declining in 2023 to US$158,445 million and subsequently increasing in 2024 to US$169,810 million.

Regarding asset turnover ratios, the reported total asset turnover improved from 0.47 in 2020 to 0.52 in 2021, indicating enhanced efficiency in utilizing assets to generate sales. The ratio stabilized around 0.51 during 2022 and 2023, with a slight decrease to 0.49 in 2024. The adjusted total asset turnover ratio follows a comparable pattern, with an increase from 0.50 in 2020 to a peak of 0.55 in 2021, a small decline to 0.53 in 2022, a recovery to 0.54 in 2023, and a modest decrease to 0.52 in 2024.

Overall, these data points suggest that while the company experienced growth in sales and assets until 2022, there was some contraction in 2023 likely affecting both asset base and sales volumes. The partial recovery in 2024 indicates efforts towards reestablishing growth momentum and asset utilization efficiency. The stability in asset turnover ratios post-2021 reflects a consistent use of assets in generating revenue, albeit with slight fluctuations towards the end of the period.

The analysis of the financial data over the five-year period reveals several key trends in liquidity and working capital management.

Current Assets

Current assets exhibited growth from 51,237 million US dollars at the end of 2020 to a peak of 60,979 million US dollars at the end of 2021, indicating an improvement in short-term resource availability. However, there was a decline in 2022 to 55,294 million US dollars, followed by a slight decrease in 2023 to 53,495 million US dollars. The figure rebounded modestly in 2024 to 55,893 million US dollars, signaling some recovery but remaining below the 2021 peak.

Current Liabilities

Current liabilities showed a steady increase from 42,493 million US dollars in 2020 to 45,226 million US dollars in 2021. A significant jump occurred in 2022, reaching 55,802 million US dollars, which surpassed the prior liabilities growth pace. This was followed by a decrease to 46,282 million US dollars in 2023 but increased again in 2024 to 50,321 million US dollars, contributing to fluctuations in liquidity ratios.

Reported Current Ratio

The reported current ratio improved from 1.21 in 2020 to 1.35 in 2021, reflecting enhanced short-term solvency. However, the ratio dropped sharply to 0.99 in 2022, indicating that current liabilities exceeded current assets, potentially highlighting liquidity stress during that year. The ratio improved in 2023 to 1.16 and slightly decreased in 2024 to 1.11, suggesting a recovery but still signaling relatively tight liquidity conditions compared to previous years.

Adjusted Current Assets and Ratio

Adjusted current assets closely mirror the reported current assets, showing a similar pattern of growth, decline, and partial recovery. Accordingly, the adjusted current ratio follows the same trend as the reported current ratio, confirming the consistency and reliability of the adjustments made to asset measures when assessing liquidity.

In summary, the company experienced an initial increase in liquidity as evidenced by rising current assets and current ratio through 2021. The sharp decline in the current ratio during 2022, primarily due to a substantial increase in current liabilities alongside decreased assets, signals a period of liquidity constraint. Partial recovery in 2023 and 2024 indicates efforts to restore working capital balance, though the current ratio remains slightly below historical peaks. These trends suggest the company should continue monitoring short-term obligations and asset management to maintain adequate liquidity.

Total Debt

The total debt displayed fluctuations over the five-year period. It decreased from 35,266 million USD at the end of 2020 to 33,751 million USD in 2021, followed by an increase to 39,659 million USD in 2022. In 2023, total debt dropped significantly to 29,332 million USD before rising again to 36,634 million USD in 2024. Overall, the trend exhibits variability with a peak in 2022 and a trough in 2023.

Shareholders' Equity

Shareholders' equity generally increased from 63,278 million USD at the end of 2020 to a high of 76,804 million USD in 2022. Subsequently, it declined to 68,774 million USD in 2023 before experiencing a modest recovery to 71,490 million USD in 2024. Despite the dip in 2023, the equity figures suggest growth over the long term, although with some volatility in the later periods.

Reported Debt to Equity Ratio

The reported debt to equity ratio decreased from 0.56 in 2020 to 0.46 in 2021, indicating an improvement in leverage. It then increased to 0.52 in 2022, declined again to 0.43 in 2023, and rose to 0.51 in 2024. This ratio oscillated but remained below the initial 2020 level in most years except 2022 and 2024, suggesting cautious management of debt relative to equity.

Adjusted Total Debt

The adjusted total debt follows a pattern similar to the reported total debt, starting at 36,366 million USD in 2020, decreasing in 2021 to 34,751 million USD, then increasing to 40,959 million USD in 2022. A reduction occurred in 2023 to 30,432 million USD, followed by an increase in 2024 to 37,834 million USD. The adjusted figures are consistently higher than reported debt, indicating additional adjustments or inclusions in debt measurement.

Adjusted Shareholders' Equity

Adjusted shareholders' equity rose steadily from 62,252 million USD in 2020 to 74,258 million USD in 2022, before declining to 62,854 million USD in 2023 and slightly increasing to 63,644 million USD in 2024. This pattern mirrors the reported equity trend, with a peak in 2022 followed by a decline and marginal recovery.

Adjusted Debt to Equity Ratio

The adjusted debt to equity ratio decreased from 0.58 in 2020 to 0.49 in 2021, then increased to 0.55 in 2022. It decreased again to 0.48 in 2023 before reaching the highest value of 0.59 in 2024. Compared to the reported ratio, the adjusted ratio shows more pronounced volatility, with the highest leverage observed in 2024. This suggests an increased relative debt burden when adjustments are considered.

Total Debt

Total debt exhibited fluctuations over the analyzed period. It decreased from 35,266 million US$ at the end of 2020 to 33,751 million US$ at the end of 2021. This was followed by a significant increase to 39,659 million US$ in 2022, a sharp decline to 29,332 million US$ in 2023, and a rise again to 36,634 million US$ by the end of 2024.

Total Capital

Total capital showed an overall upward trend with some variability. It rose steadily from 98,544 million US$ at the end of 2020 to a peak of 116,463 million US$ in 2022. This was succeeded by a notable decline to 98,106 million US$ in 2023, and then an increase to 108,124 million US$ in 2024.

Reported Debt to Capital Ratio

The reported debt to capital ratio generally remained stable within a narrow range. It declined from 0.36 in 2020 to 0.31 in 2021, increased to 0.34 in 2022, dropped to 0.30 in 2023, and reverted to 0.34 in 2024. This indicates the company's leverage relative to capital fluctuated modestly without a clear upward or downward trend.

Adjusted Total Debt

Adjusted total debt followed a similar pattern to total debt, reflecting some adjustments made to the reported figures. Starting at 36,366 million US$ in 2020, it slightly decreased to 34,751 million US$ in 2021, then rose sharply to 40,959 million US$ in 2022. In 2023, it fell to 30,432 million US$, and then increased to 37,834 million US$ by 2024.

Adjusted Total Capital

Adjusted total capital trends largely aligned with total capital figures. It increased from 98,618 million US$ in 2020 to 115,217 million US$ in 2022, then decreased substantially to 93,286 million US$ in 2023, followed by a rise to 101,478 million US$ at the end of 2024.

Adjusted Debt to Capital Ratio

The adjusted debt to capital ratio showed moderate variation throughout the period. It started at 0.37 in 2020, decreased to 0.33 in 2021, increased to 0.36 in 2022, dropped slightly to 0.33 in 2023, and rose again to 0.37 in 2024. This indicates fluctuations in financial leverage after adjustments, mirroring the changes observed in adjusted debt and capital.

The financial data presents several notable trends in asset and equity values as well as leverage ratios over the five-year period.

Total Assets

Total assets showed an overall growth from 174,894 million US dollars at the end of 2020 to 180,104 million US dollars by the end of 2024. However, there was a decline observed in 2023, where total assets decreased to 167,558 million US dollars before rebounding in 2024.

Shareholders’ Equity

Shareholders’ equity demonstrated a general upward trend, increasing from 63,278 million US dollars in 2020 to 71,490 million US dollars in 2024. A peak equity value was observed in 2022 at 76,804 million US dollars, followed by a decline in 2023 and a slight recovery in 2024.

Reported Financial Leverage

Reported financial leverage decreased markedly from 2.76 in 2020 to 2.44 in 2022 and then stabilized through 2023 before a slight increase to 2.52 in 2024. This indicates a reduction in leverage initially, suggesting a strengthening equity base relative to assets, with a modest increase in leverage towards the end of the period.

Adjusted Total Assets

The adjusted total assets followed a similar pattern to total assets, starting at 166,653 million US dollars in 2020 and ending at 169,810 million US dollars in 2024. Decline was also evident in 2023, reaching 158,445 million US dollars, prior to a recovery in 2024.

Adjusted Shareholders’ Equity

Adjusted shareholders’ equity reflected a pattern akin to reported equity, rising from 62,252 million US dollars in 2020 to 74,258 million US dollars in 2022, then falling to 62,854 million US dollars in 2023, followed by a small gain to 63,644 million US dollars in 2024.

Adjusted Financial Leverage

The adjusted financial leverage decreased from 2.68 in 2020 to 2.40 in 2022, indicating reduced leverage, but then increased to 2.67 by the end of 2024. The upward adjustment in leverage ratios from 2022 onwards signals an increased reliance on liabilities or a reduction in adjusted equity relative to adjusted assets in the last two years.

In summary, the data reveals growth in asset and equity values interrupted by a dip in 2023, with recovery in 2024. Financial leverage ratios suggest an initial deleveraging phase up to 2022, followed by a modest increase in leverage thereafter. The adjusted figures corroborate these trends, implying consistent patterns even when adjustments are applied. The fluctuations in leverage and equity relative to assets point to strategic balance sheet management across the periods analyzed.

The annual financial data reveals several notable trends and fluctuations over the five-year period observed.

Net earnings

Net earnings show an overall volatile pattern. From 2020 to 2021, there was a significant increase, rising from 14,714 million US dollars to 20,878 million US dollars. However, the subsequent year experienced a decline to 17,941 million US dollars. In 2023, net earnings surged substantially to 35,153 million US dollars, representing the peak within the period. The latest year, 2024, shows a sharp decline back to 14,066 million US dollars, the lowest point across these years except for the earliest.

Sales to customers

Sales to customers exhibit relatively less variation compared to net earnings. Sales increased steadily from 82,584 million US dollars in 2020 to a peak of 94,943 million US dollars in 2022. However, a decline is seen in 2023 to 85,159 million US dollars followed by a moderate recovery to 88,821 million US dollars in 2024. Despite fluctuations, sales remain within a narrow band of approximately 82,000 to 95,000 million US dollars.

Reported net profit margin

The reported net profit margin reflects a pattern closely linked with net earnings. After a steady increase from 17.82% in 2020 to 22.26% in 2021, the margin declined to 18.9% in 2022. A notable spike to 41.28% occurred in 2023, possibly indicating extraordinary profitability or one-off factors driving net earnings higher relative to sales. In 2024, the margin declined sharply to 15.84%, the lowest over the five years.

Adjusted net earnings

Adjusted net earnings displayed growth from 14,289 million US dollars in 2020 to a peak of 20,920 million US dollars in 2021. This was followed by a steady decline in 2022 to 16,342 million US dollars and a steep drop in 2023 to 4,523 million US dollars. There is a partial recovery in 2024 to 12,670 million US dollars, though it remains significantly lower than the earlier peaks. This suggests that adjustments considered in these figures exclude some factors that contributed to the spike in reported net earnings in 2023.

Adjusted net profit margin

The adjusted net profit margin trends largely mirror the adjusted net earnings. It rose from 17.3% in 2020 to 22.31% in 2021, then declined to 17.21% in 2022. The margin dropped drastically to 5.31% in 2023, corroborating the steep decrease in adjusted earnings despite the increase in reported net profit margin. In 2024, it improved moderately to 14.26%, yet still remains below earlier peak levels.

In summary, the financial performance shows a complex dynamic where reported profits and margins experienced a significant but potentially non-recurring peak in 2023, while adjusted figures indicate underlying earnings were weaker during this period. Sales remained relatively stable, suggesting external factors or accounting adjustments heavily influenced the net earnings and margins. The decline in both adjusted earnings and margins in the latest year implies caution in interpreting profitability trends without considering the nature of adjustments applied.

The financial data reveals notable fluctuations in earnings, equity, and return on equity over the five-year period. Net earnings demonstrate variability with a peak in 2023 followed by a decline in 2024, suggesting volatility in profitability. Adjusted net earnings show a significantly different pattern, with a steep drop in 2023 before partially recovering in 2024.

Net Earnings

Net earnings increased substantially from 14,714 million US dollars in 2020 to 20,878 million in 2021, then decreased to 17,941 million in 2022. A sharp increase occurred in 2023, reaching 35,153 million, followed by a steep decline to 14,066 million in 2024. This indicates inconsistency in net profitability, with 2023 being an outlier year of exceptional earnings.

Shareholders’ Equity

Shareholders’ equity showed moderate growth from 63,278 million in 2020 to 74,023 million in 2021, then a slight increase to 76,804 million in 2022. However, it contracted to 68,774 million in 2023 and recovered marginally to 71,490 million in 2024. This suggests some reduction in equity base after 2022, which partially rebounded by the end of 2024.

Reported Return on Equity (ROE)

The reported ROE mirrors the net earnings trends, rising from 23.25% in 2020 to 28.2% in 2021, then falling to 23.36% in 2022. A significant jump to 51.11% was observed in 2023, followed by a decrease to 19.68% in 2024. This sharp increase and subsequent decline underscore the irregular earnings performance influencing shareholder returns.

Adjusted Net Earnings

Adjusted net earnings were relatively stable, increasing from 14,289 million in 2020 to 20,920 million in 2021, then decreasing to 16,342 million in 2022. There was a pronounced decline in 2023 to 4,523 million, with a partial recovery to 12,670 million in 2024. The marked drop in 2023 implies significant adjustments affecting reported profitability that year.

Adjusted Shareholders’ Equity

The adjusted shareholders’ equity followed a somewhat similar pattern to the reported equity, growing from 62,252 million in 2020 to 71,517 million in 2021, increasing again to 74,258 million in 2022, then falling to 62,854 million in 2023 and slightly increasing to 63,644 million in 2024. This pattern reflects fluctuations in the adjusted equity base with a notable contraction in 2023.

Adjusted Return on Equity (ROE)

The adjusted ROE increased from 22.95% in 2020 to 29.25% in 2021 but declined to 22.01% in 2022. A steep reduction to 7.2% occurred in 2023, followed by a recovery to 19.91% in 2024. The adjusted ROE's sharp drop in 2023 aligns with the decline in adjusted net earnings and equity, indicating substantial adjustments impacting profitability that year.

Overall, the data indicates a period of growth in earnings and equity through 2021, followed by volatility and significant declines in adjusted results during 2023. The reported figures show a dramatic spike in profitability in 2023 that is not reflected in the adjusted numbers, suggesting the presence of non-recurring factors or accounting adjustments. Both reported and adjusted returns on equity reflect these trends, with 2023 representing an abnormal year in terms of financial performance. By 2024, partial recovery is evident in adjusted metrics, although net earnings and reported ROE decreased compared to the peak in 2023.

Net Earnings

Net earnings exhibited significant fluctuation over the five-year period. Starting at $14,714 million in 2020, the figure increased notably in 2021 to $20,878 million, followed by a decline to $17,941 million in 2022. A substantial surge occurred in 2023, reaching a peak of $35,153 million, before decreasing sharply to $14,066 million in 2024. This volatility indicates considerable variability in profitability, with 2023 being an outlier year of exceptionally high earnings.

Total Assets

Total assets showed moderate changes, rising from $174,894 million in 2020 to a high of $187,378 million in 2022. However, there was a noticeable decline in 2023 to $167,558 million, followed by a moderate recovery to $180,104 million in 2024. The asset base remained relatively stable overall, despite the dip in 2023.

Reported Return on Assets (ROA)

Reported ROA followed a pattern consistent with net earnings. It increased from 8.41% in 2020 to 11.47% in 2021, then declined to 9.57% in 2022. A striking increase to 20.98% was observed in 2023, which aligns with the net earnings peak. In 2024, reported ROA fell back to 7.81%, below the initial 2020 level, reflecting the reduction in profitability relative to assets.

Adjusted Net Earnings

Adjusted net earnings showed a different trajectory compared to reported net earnings. After rising from $14,289 million in 2020 to $20,920 million in 2021, adjusted earnings decreased to $16,342 million in 2022 and then sharply dropped to $4,523 million in 2023. A partial recovery occurred in 2024 with adjusted earnings reaching $12,670 million. This pattern suggests that some one-time or non-recurring items may have significantly influenced reported earnings, especially notable in 2023.

Adjusted Total Assets

Adjusted total assets mirrored the trend of total assets, increasing from $166,653 million in 2020 to $178,458 million in 2022, then decreasing to $158,445 million in 2023 before a slight increase to $169,810 million in 2024. The adjusted asset figures indicate a reduction in asset base during 2023, consistent with the reported figures but slightly lower in magnitude.

Adjusted Return on Assets (ROA)

Adjusted ROA increased from 8.57% in 2020 to 12.16% in 2021, then declined to 9.16% in 2022. Unlike the reported ROA, it significantly dropped to 2.85% in 2023, reflecting the substantial decline in adjusted net earnings. A recovery to 7.46% in 2024 still left adjusted ROA below earlier years, suggesting a more conservative reflection of profitability relative to assets after adjustments for extraordinary items.