JNJ + Google = Less Surgeons in the Future, or Not? (Dec 10, 2015 9:18am EST)

Highlights
Johnson & Johnson (ticker JNJ) and Alphabet (parent company of Google; ticker GOOG) Inc’s life sciences unit have formed an independent company to create far smaller, smarter and less costly robotic-assisted systems for surgery than those sold now by other companies, J&J said on Thursday.

J&J’s Ethicon division, world leader in equipment for general surgery, designed a basic prototype of the robot last year and expects it to be a “disruptive” alternative to existing products, Gary Pruden, global chairman of J&J’s medical devices group, said in an interview.

Current robotic systems, including those sold by market leader Intuitive Surgical Inc, are the size of a compact car and require the surgeon to sit at a control panel about 10 feet from the patient, Pruden said

It (JNJ+Google innovation surgical robot) would come loaded with technologies from Alphabet, including “machine learning,” in which the robot could analyze a video library of images from hundreds of previous surgeries in order to instruct the surgeon where to cut.

“Our goal is to have a lower-cost product, with the smallest footprint, with greater capability, that helps to raise the standard of care,” Pruden said. “That would be a market disruption.”

JNJ Financials (Gurufocus.com)
Profitability:
Operating margin (%) 26.5
Net-margin (%) 20.87
ROE (%) 20.61
ROA (%) 11.2

Ratios
P/E(ttm) 18.56
P/B 3.71
P/S 3.87

Dividends:
Dividend Yield 3.05
Dividend Payout 56%
Dividend Growth (3y) 7

Reference

http://www.reuters.com/article/us-alphabet-johnson-johnson-robots-idUSKBN0TT1SB20151210

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