Cigarette volumes keep declining, which is especially concerning given MO's recent inability to offset the negative volume effect with pricing power. The Company tries navigating the market with alternative product categories, and there's some positive news regarding that. However, the alternative product segments also face some headwinds (NJOY), or MO is yet to launch its first products (heated tobacco sticks).
Altria (MO) closed the most recent trading day at $46.45, moving +1.55% from the previous trading session.
Altria's (MO) NJOY obtains authorization from the U.S. Food and Drug Administration for menthol e-vapor products.
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WASHINGTON — The Food and Drug Administration on Friday authorized the first menthol-flavored electronic cigarettes for adult smokers, acknowledging that vaping flavors can reduce the harms of traditional tobacco smoking.
The decision lends new credibility to vaping companies' longstanding claim that their products can help blunt the toll of smoking.
Altria distributes a generous dividend that yields 8.75% at the current share price. Its declining revenues could become a long-term threat to the sustainability of the payout.
Tobacco stocks have a bad reputation. Investors with a particular set of ethics tend to veer away from them because the companies' products are known to be detrimental to people's health.
Altria remains a profit machine, but its growth has stalled. Verizon is a top-yielding stock, and the telecom industry is showing signs of stabilizing.
In the most recent trading session, Altria (MO) closed at $44.80, indicating a +0.22% shift from the previous trading day.
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Diversified investors have not been rewarded so far in 2024 as the tech-heavy SPX has outperformed value strategies and the total return of defensive sectors. But Altria presents solid fundamentals with high free cash flow, steady EPS growth, and an attractive dividend yield. Altria's technical view has improved with resistance at $47-$49, support at 200-day moving average following a break of a multi-year downtrend.