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Philip Morris International (PM): A Bull Case Theory
Philip Morris International (PM): A Bull Case Theory

Yahoo

time15-07-2025

  • Business
  • Yahoo

Philip Morris International (PM): A Bull Case Theory

We came across a bullish thesis on Philip Morris International on WorldlyInvest's Substack. As of 2ⁿᵈ July, Philip Morris International's share was trading at $175.91. PM's trailing and forward P/E were 27.70 and 24.43 respectively according to Yahoo Finance. Diego Cervo/ Russo views Philip Morris International (PM) as one of the most remarkable examples in the author's portfolio of a company with the capacity to reinvest and transform itself. Over the past 14 years, PM has invested aggressively into developing Reduced Risk Products (RRPs) like IQOS, VEEV ONE, and ZYN. IQOS, its flagship heat-not-burn product, is now a major success in Japan and expanding in Western Europe. The regulatory backdrop is improving, with ZYN recently gaining FDA recognition as reduced-risk. PM's deep investments are creating network effects in its RRPs ecosystem, where scale, retail presence, and consumer loyalty drive competitive advantage. Russo sees PM as having built a durable path to grow nicotine market share in safer formats — aligning both with societal trends and future revenue/profit growth. PM's capacity to suffer — making $14B+ in RRP investments ahead of peers — positions it as the clear leader in the industry's future. The company's investments in innovation and renovation of their product lineup, underwritten cumulative smoke-free product investments of $14 billion, growing sharply from a smaller base of $2.4 billion in 2015, make it an attractive investment. Previously, we covered a on Philip Morris International by Librarian Capital in June 2025, which highlighted the company's potential as a backdoor play on the AI energy boom through its nuclear energy infrastructure assets. The stock has depreciated by 1.90% since then. This previous thesis emphasized PM's critical energy infrastructure and potential to profit from the AI energy spike, but it didn't play out as AI focus shifted. WorldlyInvest's current thesis shares a similar view on PM's growth potential, but emphasizes its successful transformation through investments in Reduced Risk Products like IQOS and ZYN, positioning it for future revenue growth. PM isn't on our list of the 30 Most Popular Stocks Among Hedge Funds. While we acknowledge the risk and potential of PM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. This article was originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

Philip Morris International (PM): A Bull Case Theory
Philip Morris International (PM): A Bull Case Theory

Yahoo

time15-07-2025

  • Business
  • Yahoo

Philip Morris International (PM): A Bull Case Theory

We came across a bullish thesis on Philip Morris International on WorldlyInvest's Substack. As of 2ⁿᵈ July, Philip Morris International's share was trading at $175.91. PM's trailing and forward P/E were 27.70 and 24.43 respectively according to Yahoo Finance. Diego Cervo/ Russo views Philip Morris International (PM) as one of the most remarkable examples in the author's portfolio of a company with the capacity to reinvest and transform itself. Over the past 14 years, PM has invested aggressively into developing Reduced Risk Products (RRPs) like IQOS, VEEV ONE, and ZYN. IQOS, its flagship heat-not-burn product, is now a major success in Japan and expanding in Western Europe. The regulatory backdrop is improving, with ZYN recently gaining FDA recognition as reduced-risk. PM's deep investments are creating network effects in its RRPs ecosystem, where scale, retail presence, and consumer loyalty drive competitive advantage. Russo sees PM as having built a durable path to grow nicotine market share in safer formats — aligning both with societal trends and future revenue/profit growth. PM's capacity to suffer — making $14B+ in RRP investments ahead of peers — positions it as the clear leader in the industry's future. The company's investments in innovation and renovation of their product lineup, underwritten cumulative smoke-free product investments of $14 billion, growing sharply from a smaller base of $2.4 billion in 2015, make it an attractive investment. Previously, we covered a on Philip Morris International by Librarian Capital in June 2025, which highlighted the company's potential as a backdoor play on the AI energy boom through its nuclear energy infrastructure assets. The stock has depreciated by 1.90% since then. This previous thesis emphasized PM's critical energy infrastructure and potential to profit from the AI energy spike, but it didn't play out as AI focus shifted. WorldlyInvest's current thesis shares a similar view on PM's growth potential, but emphasizes its successful transformation through investments in Reduced Risk Products like IQOS and ZYN, positioning it for future revenue growth. PM isn't on our list of the 30 Most Popular Stocks Among Hedge Funds. While we acknowledge the risk and potential of PM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. This article was originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

Will Altria's Smoke-Free Bets Deliver Long-Term Revenue Lift?
Will Altria's Smoke-Free Bets Deliver Long-Term Revenue Lift?

Globe and Mail

time27-06-2025

  • Business
  • Globe and Mail

Will Altria's Smoke-Free Bets Deliver Long-Term Revenue Lift?

Altria Group, Inc. MO is doubling down on its shift to a smoke-free future, but the critical question is whether this strategic pivot can deliver sustained long-term revenue growth. In the first quarter of 2025, the company's oral tobacco portfolio — anchored by its on! nicotine pouch brand — continued to gain traction. Shipment volumes for on! increased 18% year over year to over 39 million cans. Notably, its market share in the oral tobacco category expanded by 1.8 percentage points to 8.8%, while its share of the nicotine pouch market rose to 17.9%. These gains came despite retail price hikes, reflecting both strong consumer loyalty and brand strength. This momentum helped drive a modest 0.5% increase in Oral Tobacco Products revenues to $654 million in the first quarter, largely attributed to pricing power. While the growth rate may seem tepid, the ability to grow revenues amid volume pressure and macroeconomic uncertainty signals strong underlying fundamentals. On the vapor front, Altria faces tougher terrain. Regulatory setbacks have forced the discontinuation of NJOY ACE, its flagship e-vapor product. However, the company plans to launch new, compliant alternatives. If successful, the revamped NJOY lineup could help recapture vapor market share. Long-term success hinges on Altria's ability to scale its reduced-risk portfolio (RRPs) while navigating regulatory headwinds. If it can maintain pricing power, expand distribution and deliver innovation across smoke-free platforms, its transformation may indeed support a durable revenue lift — even as traditional cigarette volumes continue to decline. MO's Competition in the Smoke-Free Category Philip Morris International Inc. PM and British American Tobacco p.l.c. BTI are the key tobacco companies competing with Altria in the smoke-free category. Philip Morris is accelerating its shift toward RRPs, with smoke-free offerings contributing 44% of first-quarter 2025 gross profit. Driven by IQOS, ZYN and VEEV, it saw strong volume growth, a 20.4% rise in net revenues and a 33.1% increase in smoke-free gross profit. ZYN shipments rallied 53% in the United States, while VEEV volumes more than doubled in Europe. With products in 95 markets and 38.6 million users, Philip Morris is advancing toward a smoke-free future. British American Tobacco is reshaping its business around RRPs, targeting 50 million consumers by 2030 and aiming for a 50% revenue contribution by 2035. In 2024, its smokeless user base reached 29.1 million, with New Category revenues up 2.5%. British American Tobacco's flagship brands — Vuse, glo and Velo — have collectively driven over £3 billion in revenues, reflecting its progress toward a smoke-free future. MO's Price Performance, Valuation & Estimates Shares of Altria have gained 12.5% year to date compared with the industry 's growth of 37.7%. From a valuation standpoint, MO trades at a forward price-to-earnings ratio of 10.76X, below the industry's average of 15.36X. The Zacks Consensus Estimate for MO's 2025 earnings implies year-over-year growth of 4.9%, whereas its 2026 earnings estimate suggests a year-over-year uptick of 3.3%. The estimates for 2025 and 2026 have moved up in the past 30 days. MO stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Zacks' Research Chief Picks Stock Most Likely to "At Least Double" Our experts have revealed their Top 5 recommendations with money-doubling potential – and Director of Research Sheraz Mian believes one is superior to the others. Of course, all our picks aren't winners but this one could far surpass earlier recommendations like Hims & Hers Health, which shot up +209%. See Our Top Stock to Double (Plus 4 Runners Up) >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Altria Group, Inc. (MO): Free Stock Analysis Report Philip Morris International Inc. (PM): Free Stock Analysis Report British American Tobacco p.l.c. (BTI): Free Stock Analysis Report

MO or PM: Which Tobacco Giant Offers Better Value in 2025?
MO or PM: Which Tobacco Giant Offers Better Value in 2025?

Globe and Mail

time26-06-2025

  • Business
  • Globe and Mail

MO or PM: Which Tobacco Giant Offers Better Value in 2025?

For investors looking at the tobacco sector in 2025, the choice often comes down to two giants — Altria Group, Inc. MO and Philip Morris International Inc. PM. Though both companies share a common origin, their business strategies have diverged. Altria remains a U.S.-focused powerhouse, relying on its strong cigarette portfolio while gradually expanding into next-generation products. In contrast, Philip Morris is leading the global charge toward reduced-risk products (RRPs), with successful innovations like IQOS and ZYN. While Philip Morris is widely viewed as the growth leader, Altria offers compelling value through its high dividend yield, attractive valuation and growing traction in RRPs — making it a strong contender for income-focused investors and bargain hunters. The Case for Philip Morris Philip Morris is at the forefront of the tobacco industry's shift toward a smoke-free future. Its flagship heat-not-burn product, IQOS, has become a cornerstone of this transformation, gaining strong traction in key international markets. IQOS offers adult smokers an alternative to traditional cigarettes, aligning with global trends toward harm reduction. Its success has not only driven volume growth but also helped Philip Morris solidify its position as a leader in the global RRP segment. The company further expanded its smoke-free portfolio with the acquisition of Swedish Match in 2022, bringing the popular ZYN nicotine pouches under its umbrella. This move gave Philip Morris a strong presence in the fast-growing oral nicotine market and created a more complete RRP ecosystem that spans both inhalable and non-inhalable products. In the first quarter of 2025, smoke-free products contributed 42% of total revenues and 44% of gross profit, highlighting their growing contribution to the business. IQOS and ZYN continued to gain market share, driving 15% year-over-year revenue growth in the smoke-free segment. At the same time, Philip Morris has managed to sustain growth in its traditional tobacco segment, reporting 3.8% organic revenue growth in combustibles in the first quarter. This balance between legacy product strength and forward-looking innovation underscores the company's ability to execute a dual-track strategy. Furthermore, its diversified global footprint allows PM to tap into new markets. However, this global strategy is not without risks. The company is exposed to currency volatility, which weighed on first-quarter results, including a 7-cent hit to adjusted earnings per share (EPS) from foreign exchange losses. Additionally, governments around the world are imposing stricter regulations on nicotine products, including marketing restrictions on pouches and further scrutiny of heated tobacco devices. Philip Morris' strong lead in RRPs sets high expectations, but any regulatory hurdles or changes in consumer trends could slow its growth trajectory. One-Year Price Performance The Case for Altria Altria continues to prove its resilience in the face of declining cigarette volumes, thanks largely to its strong pricing power. In the first quarter of 2025, the company's ability to raise prices helped offset shipment declines across both the Smokeable and Oral Tobacco segments. Historically, Altria has relied on pricing as a tool to maintain profitability, and that strategy remains effective even as consumption trends shift. As cigarette demand tends to be inelastic, the company can continue to drive margins despite lower volumes. With projected adjusted earnings per share ranging between $5.30 and $5.45 for 2025, indicating up to 5% year-over-year growth, Altria provides consistent earnings visibility alongside a dividend yield exceeding 6.5%, making it particularly attractive to value and income-focused investors. Altria is also making steady progress in its smoke-free future strategy, which is critical as consumer preferences evolve. Its wholly owned subsidiary, Helix Innovations, is expanding the reach of on!, a tobacco-derived nicotine pouch product that is quickly gaining traction in the U.S. market. In the first quarter of 2025, shipments of on! grew 18% year over year to over 39 million cans. The product's share of the oral tobacco category rose to 8.8%, and it captured 17.9% of the nicotine pouch market, despite higher retail pricing. This performance reflects the strength of the brand and growing consumer acceptance. Following its 2023 acquisition of NJOY, Altria has entered the e-vapor category with a clear commitment to product quality and regulatory compliance. While a recent regulatory ruling led to the market exit of NJOY ACE, management views this challenge as an opportunity to rethink its vapor portfolio and relaunch with a stronger, more innovative lineup tailored for adult consumers. By focusing on a fully regulated market and leveraging NJOY's R&D capabilities, Altria aims to carve out a durable position in a category. To accelerate its strategic goals and improve efficiency, Altria has introduced a company-wide transformation initiative called Optimize & Accelerate. Savings from this will be reinvested to support its long-term vision and 2028 enterprise goals. Meanwhile, the company continues to closely monitor macroeconomic pressures, evolving consumer behavior, illicit vapor enforcement, and shifting regulations. Despite these challenges, Altria remains a fundamentally sound investment with strong cash flow, pricing power, a growing presence in RRPs, and a commitment to delivering shareholder returns, making it a stock worth considering in 2025. How Does the Zacks Consensus Estimate Compare for PM & MO? The Zacks Consensus Estimate for Philip Morris' 2025 EPS has remained unchanged over the last 30 days at $7.47. In comparison, the consensus EPS estimate for Altria has moved up by 2 cents to $5.37 during the same period. Altria's upward EPS revision signals improving sentiment, while Philip Morris' steady estimate suggests stable but fully priced expectations. Valuation & Price Performance of PM & MO When it comes to valuation, Philip Morris trades at a forward 12-month P/E of 22.76x, reflecting investors' willingness to pay a premium for its global footprint and smoke-free momentum. Altria, on the other hand, trades at a significantly lower multiple of 10.79x, making it more attractive from a value perspective, especially for income-focused investors seeking high-yield, stable earnings in a mature market. Stock performance over the past year further highlights the divergence between the two companies. Philip Morris has delivered an impressive 76.1% gain, far outpacing Altria's 27.1% and the broader S&P 500's 10.8% return. This strong rally suggests heightened investor confidence in PM, though it may also limit near-term upside. Investor Takeaway: Altria vs. Philip Morris in 2025 Both Altria and Philip Morris offer unique strengths for investors in 2025. Philip Morris stands out for its global leadership in RRPs, innovation in heated tobacco and strong stock performance. However, much of its transformation success appears priced in, and ongoing regulatory and currency risks could pose challenges. Altria, while being more U.S.-focused and facing cigarette volume pressures, presents a compelling value story. With a lower valuation, improving traction in smoke-free products like on! and room for vapor category re-entry, Altria offers more upside potential for value and income-oriented investors seeking growth. MO currently has a Zacks Rank #2 (Buy), while PM carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Research Chief Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months. Free: See Our Top Stock And 4 Runners Up Altria Group, Inc. (MO): Free Stock Analysis Report Philip Morris International Inc. (PM): Free Stock Analysis Report

Sports Direct pricing could be misleading shoppers, consumer group claims
Sports Direct pricing could be misleading shoppers, consumer group claims

Irish Independent

time06-06-2025

  • Business
  • Irish Independent

Sports Direct pricing could be misleading shoppers, consumer group claims

UK consumer agency 'Which?' has reported Sports Direct to the competition watchdog following tip offs over the retail giant's use of 'Recommended Retail Prices' ©Press Association Sports Direct's pricing could be misleading shoppers into thinking they are getting a better deal than they really are, consumer group Which? has said. The watchdog has reported Sports Direct to the Competition and Markets Authority (CMA) following tip-offs over the retail giant's use of Recommended Retail Prices (RRPs).

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