Slow and Steady Pays Off

Many defensive, consumer-staple names have run way up over the last 18 months. Even with the pullback on higher rates, many now come with price-to-earnings ratios around 20. There has been one laggard, however, that is still trading well below its historical multiple: Johnson & Johnson (JNJ).

The diversified healthcare player straddles the medical and consumer staple categories. This could explain why shares trade at a discount, because analysts can't figure out which one it belongs to. But here's the catch: JNJ is not only trading at a discount to its peers but also to its historical valuation. Look at some comparables in both sectors....373 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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