General Electric Company (GE), Johnson & Johnson (JNJ): How Conglomerates Can Stabilize Your Portfolio

Johnson & Johnson’s place in healthcare enables it to grow faster than one might guess. After all, healthcare is perhaps the world’s fastest growing industry. It recently reported second-quarter earnings where revenue jumped 9% from last year, and earnings per share up 14% from last year. This is primarily a result of double-digit growth in emerging markets.

Johnson & Johnson (NYSE:JNJ) is a leader in most areas it competes in. Its pharmaceutical pipeline is active and shows promise. Also, with as much cash as Johnson & Johnson generates, it is able to drive additional growth through acquisitions. A recent example of this is its acquisition of Synthes. This acquisition has given Johnson & Johnson a leading position in the world’s orthopedic business.

The bottom line

Each of these companies are massive, and encompass various markets. This diversity can give you stability. With a diverse business model, these companies have stable earnings that translate into long-term success and shareholder returns through dividend growth.

Justin Pope has no position in any stocks mentioned. The Motley Fool recommends 3M and Johnson & Johnson (NYSE:JNJ). The Motley Fool owns shares of General Electric Company (NYSE:GE) and Johnson & Johnson. Justin is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

The article How Conglomerates Can Stabilize Your Portfolio originally appeared on Fool.com and is written by Justin Pope.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.