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

·3 min read

In the latest trading session, Altria (MO) closed at $43.27, marking a +0.6% move from the previous day. This change outpaced the S&P 500's 0.84% loss on the day. Elsewhere, the Dow lost 0.36%, while the tech-heavy Nasdaq lost 0.19%.

Coming into today, shares of the owner of Philip Morris USA, the nation's largest cigarette maker had lost 6.09% in the past month. In that same time, the Consumer Staples sector lost 7.2%, while the S&P 500 lost 10.24%.

Investors will be hoping for strength from Altria as it approaches its next earnings release, which is expected to be October 27, 2022. The company is expected to report EPS of $1.31, up 7.38% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $5.65 billion, up 2.13% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.85 per share and revenue of $20.85 billion, which would represent changes of +5.21% and -1.22%, respectively, from the prior year.

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

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Altria is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Altria has a Forward P/E ratio of 8.87 right now. For comparison, its industry has an average Forward P/E of 8.92, which means Altria is trading at a discount to the group.

It is also worth noting that MO currently has a PEG ratio of 1.36. 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 1.09 as of yesterday's close.

The Tobacco industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 194, putting it in the bottom 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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