Altria (MO) Gains But Lags Market: What You Should Know

·3 min read

Altria (MO) closed the most recent trading day at $46.53, moving +0.15% from the previous trading session. This change lagged the S&P 500's 1.62% gain on the day. Elsewhere, the Dow gained 1.17%, while the tech-heavy Nasdaq added 12.91%.

Coming into today, shares of the owner of Philip Morris USA, the nation's largest cigarette maker had lost 1.09% in the past month. In that same time, the Consumer Staples sector lost 1.42%, while the S&P 500 lost 4.54%.

Investors will be hoping for strength from Altria as it approaches its next earnings release. On that day, Altria is projected to report earnings of $1.18 per share, which would represent year-over-year growth of 5.36%. Our most recent consensus estimate is calling for quarterly revenue of $5.03 billion, up 4.4% from the year-ago period.

MO's full-year Zacks Consensus Estimates are calling for earnings of $5.07 per share and revenue of $21.18 billion. These results would represent year-over-year changes of +4.75% and +2.38%, respectively.

Investors might also notice recent changes to analyst estimates for Altria. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.08% higher. Altria is currently a Zacks Rank #3 (Hold).

In terms of valuation, Altria is currently trading at a Forward P/E ratio of 9.17. This valuation marks a discount compared to its industry's average Forward P/E of 9.18.

We can also see that MO currently has a PEG ratio of 2.29. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Tobacco stocks are, on average, holding a PEG ratio of 2.7 based on yesterday's closing prices.

The Tobacco industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 111, which puts it in the top 45% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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