MO faces pressure as the U.S. cigarette market shrinks, testing Marlboro's ability to hold share and sustain profitability.
Altria Group, Inc. (MO) Presents at Consumer Analyst Group of New York Conference 2026 Transcript
Altria (MO) has been one of the stocks most watched by Zacks.com users lately. So, it is worth exploring what lies ahead for the stock.
MO targets steady EPS growth in 2026, leaning on pricing power and buybacks as cigarette volumes slide and smoke-free bets scale.
Dividend Kings are companies that have increased their dividends for at least 50 years in a row.
Altria Group (MO) and British American Tobacco (BTI) both trade below 10x EBT, offering double-digit pretax yields reminiscent of Buffett's 10x Pretax Rule. Both companies are accelerating investments in smoke-free products, funded by robust cash flows from traditional lines, supporting sustained dividend growth. With a current dividend yield of 5~6% and mid-single-digit growth rates, I see good odds for double-digits annual returns from both.
MO is supported by resilient margins, steady cash returns and pricing power despite ongoing cigarette volume declines.
MO's aggressive cost-cutting supports margins, but pressure from falling volumes and higher spending is testing its resilience.
Altria Group Inc ( NYSE:MO ) is the company behind Marlboro cigarettes and smokeless tobacco products.
Altria offers compelling value and safety, with a resilient business model and a well-covered, nearly 7% dividend yield. MO's Q4 showed stable fundamentals: modest EPS growth, pricing power offsetting volume declines, and continued progress in smoke-free products. Frequent share buybacks and disciplined leverage support dividend sustainability, while FDA approvals and acquisitions bolster MO's smoke-free transition.
Altria remains a great Buy, with the recent volatility already triggering the discounted valuations and the consequently rich dividend yields at ~6.8%. The smokeable segment faces a painful secular decline across volume erosion, deteriorating price elasticity, and changing consumer demand for discount offerings. Otherwise, MO continues to report robust cash flow and a healthy balance sheet, with the recent US FDA marketing approval for nicotine pouches underpinning future growth opportunities.
Altria Group regains Buy rating after the release of its Q4 2025 and full year 2025 results, owing crucially to clarity on future earnings and dividends. The company expects continued growth in adjusted diluted EPS and in dividends until 2028, which is important considering its lucrative dividends. Hope of progress on its tobacco free products is encouraging too, even as its forward P/E is less compelling.