Summary
Johnson & Johnson has seen harsh times as an old asbestos claim is playing up again.
Shares have been hit hard as this times it looks serious, with public outcry on the increase.
I doubt that this storm will pass very soon as litigation is a long and uncertain process.
Despite a recent pullback, shares remain more than fairly priced at this moment as the dip is not large enough for me to buy yet.
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Days ahead of Christmas, Johnson & Johnson (JNJ) finds itself in a real crisis related to the lingering concerns about asbestos in its baby powder products in the past. While judging the potential impact and costs of any outcome is impossible to do, truth of the matter is that the market seems to take this "attack" seriously. Even as a $50-billion pullback is very large, it does not automatically create compelling opportunities in my book.
