Is Johnson & Johnson Still the Ultimate Safe Dividend Stock to Buy?
Key Points
Johnson & Johnson is a Dividend King, with 64 consecutive years of increases.
The company only spent 61% of its free cash flow in 2025 on dividend payouts.
- 10 stocks we like better than Johnson & Johnson ›
Dividend stocks are some of the best ways to make money in the stock market, but they're only as useful as their stability. You don't want to invest in a company mainly for its dividend, only to have that reduced or completely cut.
One company that hasn't had that trouble is Johnson & Johnson (NYSE: JNJ). With 64 consecutive years of dividend increases, J&J is one of the premier Dividend Kings (companies with at least 50 consecutive years of increases). But is it the ultimate safe dividend stock?
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Image source: The Motley Fool.
One of the best ways to measure a dividend's safety is to look at the company's free cash flow relative to its dividend payout. Last year, Johnson & Johnson had $20.4 billion in free cash flow and paid $12.4 billion in dividends. That 61% ratio is strong and indicative of a healthy dividend.
Whether this is the ultimate safe dividend stock to buy depends on whether you're looking strictly at financial metrics. There are companies with better (lower) payout ratios -- but they don't have J&J's longevity and balance sheet.
With $21.7 billion in cash and cash equivalents as of the end of the first quarter, the healthcare giant has the resources to keep its dividend rolling. Over the past decade, Johnson & Johnson has averaged a 2.7% dividend yield, well above the market average.
Should you buy stock in Johnson & Johnson right now?
Before you buy stock in Johnson & Johnson, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Johnson & Johnson wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $473,985!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,204,650!*
Now, it’s worth noting Stock Advisor’s total average return is 950% — a market-crushing outperformance compared to 203% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of May 6, 2026.
Stefon Walters has no position in any of the stocks mentioned. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy.
Recommended Articles
