Recession-proof Dividend King offers safe 2.2% yield | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

Johnson & Johnson reported impressive fourth-quarter results that beat expectations while outlining an aggressive growth strategy.

And here’s something investors might find appealing: Johnson & Johnson (JNJ) is a Dividend King with 63 consecutive years of dividend increases, making it one of the most reliable income stocks in the market.

As a stalwart member of the Dow Jones 30 index, JNJ is a dividend stock that offers the blue-chip stability that income investors crave.

For income-focused investors, the dividend story gets even better when you look at the numbers.

JNJ has built a well-diversified portfolio

JNJ stock is well poised for dividend growth

According to data from Fiscal.ai, Johnson & Johnson has raised its annual dividend from $1.32 per share in 2006 to $5.20 in 2026.

Analysts tracking the blue-chip stock forecast its free cash flow to increase from $25.14 billion in 2026 to $36.45 billion in 2030.

Given an annual dividend expense of about $12.50 billion, the payout ratio for JNJ stock is around 50%, which is sustainable. A growing free cash flow base should also translate to consistent dividend hikes through 2030.

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Wall Street estimates Johnson & Johnson to raise the annual dividend to $6.64 per share in 2030, boosting the yield at cost to 2.8%.

JNJ Dividend Metrics at a Glance

Current Yield: 2.2%
Dividend Growth Streak: 63 years (Dividend King status)
Payout Ratio: Approximately 50% of FCF
Quarterly Dividend: $1.30 per share
Annual Dividend: $5.20 per share
5-Year Dividend Growth Rate: Roughly 5.2% annually

Why JNJ stock stands out right now

Johnson & Johnson isn’t your typical healthcare stock relying on one or two blockbuster drugs. The company has built a portfolio spanning 28 platforms, generating at least $1 billion in annual revenue.

That diversification matters when you’re chasing sustainable growth.

CEO Joaquin Duato highlighted this strength during a recent conference, noting that the company’s InnovativeMedicine segment grew 16% when excluding STELARA biosimilar impacts. That’s impressive for a business already doing over $50 billion in annual sales.

Duato stated:

The company operates in six core areas: Oncology, Immunology, and Neuroscience on the pharma side, plus Cardiovascular, Surgery, and Vision in medical devices. Each segment brings meaningful revenue and growth potential.

Strong momentum across the board

Fourth-quarter sales reached $24.6 billion, up 7.1% on an operational basis. That growth came despite facing roughly 650 basis points of headwind from STELARA biosimilar competition.

Take that biosimilar impact away, and JNJ actually delivered double-digit growth for the full year.

DARZALEX, the company’s largest pharmaceutical product, grew 24% in the quarter.
Multiple myeloma treatment continues to gain share across all therapy lines, with particularly strong performance in frontline settings.
TREMFYA posted even more dramatic growth at 65%, driven by its inflammatory bowel disease launch and continued share gains in all indications.
On the MedTech side, the Cardiovascular segment delivered 15% operational growth.
Abiomed and Shockwave both posted strong double-digit gains, while the electrophysiology business showed improvement with VARIPULSE reaching nearly 40,000 treated patients.

The path to $100 billion

Management provided 2026 guidance for operational sales growth of 5.7%-6.7%, with a midpoint of $100 billion.

That would make JNJ the first healthcare company to cross that threshold.

The growth drivers look solid. TREMFYA, DARZALEX, CARVYKTI, ERLEADA, and SPRAVATO will lead the pharma side.
New launches like RYBREVANT plus LAZCLUZE in lung cancer and CAPLYTA for depression add to the momentum.
MedTech growth should come from VARIPULSE in electrophysiology, the ETHICON 4000 stapler in surgery, and the OASYS MAX family in vision.

Perhaps more importantly, Duato stated the company has “line of sight to double-digit growth by the end of the decade.” For a business approaching $100 billion in sales, that’s remarkable.

Building for the future

JNJ invested over$32 billion in R&D and M&A during 2025, including acquisitions of Intra-Cellular Therapies and Halda Therapeutics.

The company also announced plans to build new manufacturing facilities in North Carolina and Pennsylvania, as part of a $55 billion U.S. investment plan.
The goal is to produce all advanced medicines used domestically right here in America.
That investment includes developing OTTAVA, the company’s robotic surgery system.
Management filed for FDA approval and expects the platform to become material to growth by 2028.
In oncology, JNJ aims to hit $50 billion in annual sales by 2030. The multiple myeloma franchise alone could exceed $25 billion, according to management comments.

Recent data for TECVAYLI plus DARZALEX showed an 83% reduction in progression or death risk in second-line multiple myeloma patients. That kind of efficacy should drive strong adoption once approved.

Strong financial foundation

The company ended 2025 with roughly $20 billion in cash and marketable securities against $48 billion in debt.

Free cash flow reached $19.7 billion for the year, and management expects that figure to climb to approximately $21 billion in 2026.

That financial strength supports both business investment and shareholder returns. JNJ maintained its AAA credit rating while increasing dividends every year since 1963.

Adjusted operating margins should improve by at least 50 basis points in 2026 despite absorbing about $500 million in tariff costs and implementing a voluntary pricing agreement with the U.S. government.

The dividend remains rock solid

With a 50% payout ratio on FCF and over $25 billion in projected free cash flow, JNJ’s dividend looks secure.

The company generates enough cash to fund both dividend payments and significant reinvestment in growth initiatives.

While the 2.2% yield won’t blow anyone away, the combination of safety, growth, and a 63-year track record of increases makes this an income investment worth considering.

For investors seeking stability during uncertain times, few stocks offer JNJ’s combination of defensive characteristics, growth potential, and dividend reliability.