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

Zacks Equity Research
Sanmina (SANM) closed at $30.68 in the latest trading session, marking a +0.69% move from the prior day.

Altria (MO) closed at $49.69 in the latest trading session, marking a -1.45% move from the prior day. This move lagged the S&P 500's daily gain of 0.82%. Elsewhere, the Dow gained 0.82%, while the tech-heavy Nasdaq added 0.64%.

Prior to today's trading, shares of the owner of Philip Morris USA, the nation's largest cigarette maker had lost 4.76% over the past month. This has lagged the Consumer Staples sector's loss of 2.05% and the S&P 500's loss of 4.58% in that time.

MO will be looking to display strength as it nears its next earnings release. On that day, MO is projected to report earnings of $1.09 per share, which would represent year-over-year growth of 7.92%. Our most recent consensus estimate is calling for quarterly revenue of $5.08 billion, up 4.03% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.17 per share and revenue of $19.65 billion, which would represent changes of +4.51% and +0.14%, respectively, from the prior year.

Any recent changes to analyst estimates for MO should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Within the past 30 days, our consensus EPS projection has moved 0.03% lower. MO is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that MO has a Forward P/E ratio of 12.08 right now. This valuation marks a discount compared to its industry's average Forward P/E of 12.54.

Also, we should mention that MO has a PEG ratio of 1.58. 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. Tobacco stocks are, on average, holding a PEG ratio of 1.58 based on yesterday's closing prices.

The Tobacco industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 234, putting it in the bottom 9% 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.

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


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