We recently published Jim Cramer Talked About These 8 Stocks & The Quantum Computing Dip. Johnson & Johnson (NYSE:JNJ) is one of the stocks Jim Cramer recently discussed.
Johnson & Johnson (NYSE:JNJ) announced yesterday that it would spin off its orthopedics business to allow it to become the largest firm of its kind in the world. Cramer appreciated the decision and commented on the firm’s legal troubles as well:
“Yeah look I spoke with Joaquin Doato [JNJ CEO]. And he’s beginning to become, the spokesperson for the pharma industry in terms of the way things should be done. He spun off the orthopedic this morning. Why? Because there’s not a lot of science to new knees. There just isn’t. They haven’t developed anything. It’s keeping their price-to-earnings multiple back. It’s another brilliant move. The spinoff of Kenvue obviously. Looking really great. . .who knew that RFK Jr. was going to go after Tylenol. But that was a remarkable quarter. They are the fast growing pharma company. I think that JNJ is the paradigm shift that we’ve seen. Which is, you’ve got to get rid of anything that doesn’t grow quickly. Look at that. Look at that chart. This started by the way when they decided to fight the [inaudible] on all the talc cases. Where the [inaudible] were saying the talcum had asbestos in it. They have not been winning all the cases, they just lost one. But what’s happened is that they’re no longer negotiating on you know some gigantic settlement that could hurt them. And instead they’ve become pure pharma, no longer orthopedic, and again, no longer the generic. David this man has quietly put his stock, in a position to challenge Eli Lilly, for growth. Incredible.”
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“And they had this thing hanging over, and when you talk to the plaintiffs [inaudible] all they ever talk about is like, be careful about the dividend, be careful about the dividend. This thing should be, the growth of this, and the wealth of this should be shared equally with the plaintiffs. And I got caught up in that talk. Because they weren’t fighting, they were negotiating, JNJ. Well, Joaquin doesn’t seem like he’d be the toughest guy on the planet but he’s taking on the plaintiffs [inaudible] and it’s worked. It almost never works David. It’s working for him. And the spinoff of orthopedic is a brilliant move because boy, that’s a slow growing part of their business. You know David one day you might need a new knee, new hip, whatever, but you’re gonna be surprised that they’re kind of similar of what they were 20 years ago.”
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Disclosure: None. This article is originally published at Insider Monkey.
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