This article is part of our Rising Star portfolios series.

Why am I buying a boring large-cap stock?

Because that's what the market is giving me.

While small-cap stocks have been killing it, large caps have been stagnating. As my colleague Matt Koppenheffer has pointed out, a decade ago it was large caps that were getting huge earnings multiples from the market. Now it's the small caps.

Meanwhile, many of the stocks of the biggest, most dominating companies are trading close to P/E ratios of 10.

That's why I've been buying up stocks in big banking, big defense, and moderately big retail. Make room for big health care!

Now it's time for Johnson & Johnson
Back in October, I wrote an article breaking down exactly how Johnson & Johnson (NYSE: JNJ) makes money. At the end of the article, I said "If it slips under $60 a share again, it makes for a very compelling opportunity."

Well, J&J's closing price yesterday was $58.72.

That puts it at 11.5 times next year's earnings with strong cash flows and $10 billion more cash than debt on its balance sheet.

So it's cheap. But more importantly, it's a great company selling for cheap.

Why's it so great?
J&J is a dominant force in consumer products, pharmaceuticals, and medical devices. Basically, J&J has you covered from your bathroom cabinet to the operating table. The secret to its ability to offer so many health-care products so effectively is its decentralization. It allows for entrepreneurial activity under the umbrella (and financing costs) of a AAA-rated balance sheet. That's a powerful combination when done correctly.

This is the same advantage Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) brings to bear. Warren Buffett allows his managers to do their thing and he worries about allocating capital from up top. Perhaps that's why Berkshire owns 45 million shares of J&J.

It's also important to remember that despite its many businesses and acquisitions, J&J sticks with health-care-related products. It's a conglomerate, but it's a laser-focused conglomerate.

The main risks
Perhaps decentralization contributed to the spate of recalls of J&J products. Perhaps not. But the sheer quantity of recalls we've seen from Johnson & Johnson is scary and has the potential to unravel my investment thesis. Any brand fallout from these recalls is the key risk to watch.

In addition, as with any company that relies heavily on patents, J&J's patent expirations and pipeline of products should be monitored. Fortunately, its largest product, Remicade, which treats inflammatory disorders like rheumatoid arthritis, accounts for only 7% of sales. For comparison, Lipitor made up 16% of Pfizer's (NYSE: PFE) sales last year and Singulair made up 11% of Merck's (NYSE: MRK) sales.

The takeaway
Bottom line, Johnson & Johnson is a great company selling for a good price. In a strong bull market, it'll likely lag (as it has been doing), but its consistency and 3.7% dividend yield should help it outperform in a bear market and overall.

Tomorrow, I'm buying shares of Johnson & Johnson in the real-money portfolio I manage for The Motley Fool. If you're likewise intrigued, consider buying shares yourself and consider following along with our analysis by adding J&J to The Motley Fool's watchlist tool.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.