Altria: 8.5% Dividend Looks More Attractive In An Overheated Stock Market


  • Altria Group is facing several challenges which are reflected in its rock-bottom valuation, but it has some core strengths which make the stock a Buy.
  • The biggest issue is the secular decline in shipment volume of its smokeable products, which declined by a staggering 10 percentage points YoY in the recent quarter.
  • However, the company is making up for these lost volumes with price increases, and the worst-case scenario for volume decline is also not too bad for the long-term EPS trajectory.
  • The forward PE ratio is only 9 while the EPS projection for 2 fiscal years ahead is also quite stable at $5.5.
  • Beyond the short-term doom and gloom sentiment, the company has good fundamentals which can easily beat S&P 500 returns, especially if we face a recessionary environment.
Altria office sign in Virginia capital city tobacco business closeup by road street, parent company of Philip Morris


Altria Group (NYSE:MO) has shown some bullish rally in the year-to-date but the stock price is still 40% below the past peak of $75 hit in 2017. One of the key reasons behind the negative sentiment towards Altria stock is the rapid

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