Johnson & Johnson to Pay Dividend of $0.84 on March 13



Quarterly cash dividend

Johnson & Johnson (JNJ) began trading ex-dividend on February 26, 2018. It will pay a dividend of $0.84 per share on March 13, 2018, to shareholders of record as of February 26, 2018. The company has been paying increasing dividends to its shareholders for the last 55 years. It’s part of the S&P 500 dividend aristocrats index. Dividend aristocrats are companies that have been paying their shareholders consistently increasing dividends for at least 25 years. Some of the other med-tech companies that are S&P 500 dividend aristocrats are Medtronic (MDT), Becton Dickinson (BDX), and Abbott Laboratories (ABT).

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Capital allocation strategy

Johnson & Johnson has a strong, consistent capital allocation strategy aimed at creating shareholder value. The company is focused on funding its internal initiatives for growth, research and development, and SG&A (selling, general, and administrative) expenses. It’s also focused on providing consistent dividends to its shareholders for value creation. In order of priority, strategic acquisitions follow internal funding requirements and dividend payments. Then it considers other capital allocation modes such as share buybacks.

As of February 29, 2018, Johnson & Johnson’s dividend yield is 2.6%. Its dividend payout ratio is ~60%. In 2017, the company paid $8.9 billion in dividends to its shareholders. According to the company, more than 50% of its cash flow is being used for dividends to its shareholders. Cash flow in fiscal 2017 was estimated at $17.8 billion.

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