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Altria (MO) Gains As Market Dips: What You Should Know

Zacks Equity Research

In the latest trading session, Altria (MO) closed at $42.73, marking a +0.38% move from the previous day. This change outpaced the S&P 500's 0.14% loss on the day. At the same time, the Dow lost 0.11%, and the tech-heavy Nasdaq lost 0.1%.

Coming into today, shares of the owner of Philip Morris USA, the nation's largest cigarette maker had lost 4.25% in the past month. In that same time, the Consumer Staples sector lost 1.51%, while the S&P 500 lost 0.91%.

Wall Street will be looking for positivity from MO as it approaches its next earnings report date. This is expected to be October 31, 2019. The company is expected to report EPS of $1.14, up 5.56% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.29 billion, unchanged from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.19 per share and revenue of $19.71 billion, which would represent changes of +5.01% and +0.41%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for MO. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.76% higher. MO is currently a Zacks Rank #3 (Hold).

In terms of valuation, MO is currently trading at a Forward P/E ratio of 10.17. This represents a discount compared to its industry's average Forward P/E of 10.67.

Investors should also note that MO has a PEG ratio of 1.59 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. MO's industry had an average PEG ratio of 1.59 as of yesterday's close.

The Tobacco industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 101, putting it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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