Shares of healthcare giant Johnson and Johnson (JNJ) have come under pressure in recent days as media reports have once again resurface, suggesting that the company has potentially hid evidence that trace amounts of asbestos have been found in the talc powder products over multiple decades.

Whenever news like this hits, especially with large dominant franchises with plenty of free cash flow to cover possible legal verdicts (think BP earlier this decade), it pays to see if investors are getting a short-term bargain, enough to compensate them for what is likely to be plenty of headline risk over the coming weeks and months.

With JNJ shares only down about 15% from their highs (not much more than the S&P 500 index), no such bargain seems to have presented itself yet. I estimate JNJ is likely to report free cash flow of around $6.75 for 2018, which gives the stock a current multiple of 19.3x on a trailing basis.

While such a price is not sky high by any means, it is probably about right for a company of JNJ's size. Looking back over the last five years, we can see that JNJ has closed out each of those year's with a trailing free cash flow multiple of between 18.3x and 21.6x. Therefore, the market seems to agree with my conclusion about a fair valuation.

For me to get interested in playing JNJ as a short-term contrarian, long-term investment play, I would probably have to pay around 15x free cash flow, or near $100 per share. We are far from there at this point, and unless some impressive jury awards play out in plaintiffs' favor, or the media finds evidence that is a bit more damning, we probably won't see the stock get that low.