Not that JNJ is a "cheap stock." It's trading at a forward PE of 15 but its PEG ratio is a much more reasonable 2.55. It pays an annual dividend of $2.64, representing a payout ratio of about 55%.

What finally motivated me to go long JNJ was the news Friday that the company is considering selling its diagnostics division. I just love it when the parts are worth spinning off.

Our two previously mentioned research monarchs, whose Action Alert PLUS I subscribe to and read regularly, opined on this juicy bit of news. They wrote that JNJ's management "...could find ways to create shareholder value, believing the consumer business could be spun out.

"We still believe this to be the case, but we are pleasantly surprised to hear that it is considering other options for businesses that are underperforming."

What Link and Cramer meant was the Ortho Clinical Diagnostics unit, which makes blood-screening devices and tests, could be sold for as much as $5 billion (EBITA for this unit is $450 million) and will be marketed to private-equity firms worldwide.

This won't happen anytime soon, but they viewed the news as "... a clear positive, and it is the reason we will build this position further." If you want to know how many shares the duo bought for Cramer's charitable trust, you'll need to subscribe to Action Alerts PLUS .

At the end of the last quarter (ending June 30) JNJ reported year-over-year quarterly earnings growth of over 172%! There were some special circumstances which JNJ reported on July 16.

Net earnings and diluted earnings per share for the second quarter of 2013 were $3.8 billion and $1.33, respectively. The company said the second-quarter results included the gain on the sale of the equity interest in Elan.

Second-quarter 2013 net earnings included after-tax special items of approximately $500 million, related to litigation expenses, integration and transaction costs associated with the acquisition of Synthes and program costs associated with the DePuy ASRTM Hip, according to J&J.

If you liked this article you might like

'Date' These Potential Biotech Winners

'Date' These Potential Biotech Winners

The 10 Stocks America's Biggest Hedge Funds Are Dumping Like Crazy

Why You Keep Cash on Hand; No Downside Conviction -- Jim Cramer's Top Thoughts