Group 1: Company Performance - Altria's stock closed at $57.89, reflecting a +1.35% increase from the previous day, outperforming the S&P 500's daily loss of 4.84% [1] - Over the past month, Altria's shares gained 2.09%, underperforming the Consumer Staples sector's gain of 5.4% but outperforming the S&P 500's loss of 4.7% [1] Group 2: Upcoming Financial Results - Altria is set to announce its earnings on April 29, 2025, with an anticipated EPS of $1.19, representing a 3.48% increase from the same quarter last year [2] - Revenue is expected to be $4.66 billion, indicating a 1.11% decline compared to the year-ago quarter [2] Group 3: Fiscal Year Estimates - For the entire fiscal year, earnings are projected at $5.32 per share and revenue at $20.44 billion, reflecting changes of +3.91% and -0.03% respectively from the previous year [3] - Recent revisions to analyst forecasts for Altria are important as they indicate changing business trends, with positive revisions suggesting analyst optimism [3] Group 4: Valuation Metrics - Altria has a Forward P/E ratio of 10.74, which aligns with the industry average [6] - The company has a PEG ratio of 3.04, compared to the Tobacco industry's average PEG ratio of 2.85 [6] Group 5: Industry Context - The Tobacco industry is part of the Consumer Staples sector and holds a Zacks Industry Rank of 52, placing it in the top 21% of over 250 industries [7] - The Zacks Industry Rank measures the strength of industry groups, with the top 50% rated industries outperforming the bottom half by a factor of 2 to 1 [7]

Core Viewpoint - Altria Group's stock price declined nearly 3% following a U.S. Supreme Court ruling that negatively impacts the company's interests in flavored vapes, contrasting with the S&P 500's increase of 0.7% on the same day [1]. Group 1: Supreme Court Ruling - The Supreme Court ruled against an appeals court decision that claimed the FDA acted unlawfully in rejecting applications from Triton Distribution and Vapetasia for flavored vape products [2]. - The appeals court had previously asserted that the FDA violated the law by changing rules during the approval process for flavored vapes [3]. - The Supreme Court's decision sends the case back to the appeals court for further review, which may affect the regulatory landscape for flavored vapes [3]. Group 2: Impact on Altria - Although Altria is not directly involved in the case, the company has a vested interest in the outcome due to its reliance on next-generation products like vapes amid declining traditional cigarette consumption [4]. - A favorable ruling for the FDA in this regulatory process diminishes Altria's prospects in the flavored vape market [4]. - Despite the challenges, Altria's management has experience navigating regulatory issues and will adapt to the new developments, although current trends are not favorable for the company [5].

Core Viewpoint - Altria offers a high dividend yield of 7%, significantly above the S&P 500 average of 1.3%, but faces growth challenges and modest dividend increases, while Eli Lilly provides a lower yield of less than 1% but has shown impressive dividend growth [1][2]. Group 1: Dividend Performance - Altria has raised its dividend for 55 consecutive years, while Eli Lilly's streak began in 2015, indicating a longer history for Altria but not necessarily better growth potential [2]. - In the past five years, Altria's dividend has increased by just over 21%, whereas Eli Lilly's dividends have doubled, showcasing a stark difference in growth rates [4]. Group 2: Stock Performance and Valuation - Eli Lilly's stock has surged by 476% over the past five years, compared to Altria's 52% increase, which lags behind the S&P 500's more than 116% return [5]. - The high performance of Eli Lilly's stock has led to a lower yield, as the stock becomes more expensive relative to its dividend payouts [5]. Group 3: Future Growth Potential - Eli Lilly is experiencing significant growth, particularly in the GLP-1 weight loss market, while Altria faces uncertainty due to declining tobacco use [6]. - Long-term investors may find Eli Lilly to be a better dividend stock despite its current lower yield, as Altria risks potential dividend cuts if profits decline [7][9]. Group 4: Market Outlook - Eli Lilly's elevated valuation may limit future returns, but if returns moderate and the company continues to increase dividends, its yield could rise, making it an attractive long-term investment [8].

Core Viewpoint - Altria's stock price has appreciated by 43.48% since early 2024, driven by a bullish thesis based on two core arguments [1]. Group 1: Stock Performance - The stock price increase of 43.48% occurred before any dividends were accounted for [1]. Group 2: Investment Thesis - The bullish thesis on Altria is based on two main arguments, although the specific arguments are not detailed in the provided text [1].

Core Insights - Altria is facing significant challenges as cigarette demand declines, which is its primary revenue source, while management emphasizes potential opportunities that may indicate the company is lagging behind [1][10] Business Overview - Altria's main business revolves around cigarette sales, which constituted 88% of its revenues in 2024, with cigarettes making up nearly 98% of smokeable tobacco volumes [2] Financial Performance - Cigarette volumes have been declining for years, with a notable drop of 10.2% in 2024; however, price increases have mitigated revenue losses, resulting in a 1.3% revenue decline and a 3.4% rise in adjusted earnings [3] - The company raised its dividend in 2024, reflecting a high dividend yield of approximately 7%, which attracts dividend investors despite the negative trends in its core business [4] Market Trends - The number of smokers in the U.S. decreased from 34 million in 2019 to 28 million in 2024, while non-combustible product users remained stable at around 8 million; however, non-combustible-only consumers surged from 11 million to 18 million, marking a 60% growth [5][6] Strategic Missteps - Altria has made several strategic errors, including spinning off Philip Morris International, which left it vulnerable in a declining cigarette market and created new competition in the non-combustible space [7] - Investments in Juul and a marijuana company resulted in significant write-offs, and while the recent acquisition of NJOY shows better sales performance, it faces patent litigation with Juul [8] Growth Opportunities - Non-combustible products are increasingly important, yet Altria has not capitalized on this trend, with non-smokeable products accounting for only 11.7% of revenues in 2024, down from 12.4% in 2019, despite the non-combustible category growing significantly [9][10]

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Core Viewpoint - Altria is a reliable dividend-paying company with a long history of increasing its per-share payout, making it an attractive option for dividend income investors [1][2]. Dividend Performance - Altria has consistently paid dividends every quarter for decades and has raised its quarterly dividend payment for 55 consecutive years, with some years seeing two increases [1][2]. - The current quarterly dividend payment is $1.02 per share, and to achieve $1,000 in dividend income by 2025, an investor would need to own 245 shares, subject to potential changes in the dividend rate [2]. - The average yearly growth in Altria's quarterly dividend since 1989 has been over 6.5%, with the most recent increase being just under 4.1% [3]. Business Outlook - Altria, which owns popular U.S. cigarette brands like Marlboro and Virginia Slims, acknowledges the challenges posed by the global smoking-cessation movement and modest demand for smokeless alternatives [4]. - Despite potential future challenges, the company is expected to maintain its dividend payments for the foreseeable future, supported by population growth and a solid forward-looking dividend yield of 7.1% [5].

Company Performance - Altria's stock closed at $56.71, reflecting a -1.63% change from the previous day's closing price, underperforming the S&P 500 which gained 0.16% [1] - Over the past month, Altria's shares increased by 4.34%, outperforming the Consumer Staples sector which saw a loss of 0.69% and the S&P 500's loss of 3.59% [2] Upcoming Earnings - Altria is expected to report an EPS of $1.19, representing a 3.48% increase compared to the same quarter last year, with a revenue forecast of $4.66 billion, indicating a 1.11% decrease from the same quarter last year [3] - For the entire fiscal year, earnings are projected at $5.32 per share and revenue at $20.48 billion, reflecting changes of +3.91% and +0.18% respectively from the prior year [4] Analyst Estimates and Rankings - Recent changes in analyst estimates for Altria are crucial as they indicate evolving short-term business trends, with positive revisions suggesting analyst optimism regarding the company's profitability [4] - The Zacks Rank system, which includes estimate changes, currently ranks Altria at 3 (Hold), with the consensus EPS estimate remaining unchanged over the past month [6] Valuation Metrics - Altria has a Forward P/E ratio of 10.84, which is in line with the industry average, and a PEG ratio of 3.07, compared to the tobacco industry average PEG ratio of 2.82 [7] Industry Context - The Tobacco industry, part of the Consumer Staples sector, holds a Zacks Industry Rank of 78, placing it in the top 32% of over 250 industries, indicating strong performance potential [8]

Core Viewpoint - Altria Group, Inc. has shown strong performance in the tobacco industry, rising 5.1% over the past month, significantly outperforming the Zacks Tobacco industry's growth of 0.9% and the broader market declines [1][2][20] Stock Performance - Altria's stock closed at $57.65, only 3.4% below its 52-week high of $59.67, and reflects a 41.8% premium over its 52-week low of $40.65 [5] - The stock is trading above both its 50-day and 200-day moving averages, indicating bullish market sentiment [5][6] Competitive Position - Altria has outperformed key competitors such as Philip Morris International, which declined by 2.1%, and Turning Point Brands, which dropped by 14.4% [2] - British American Tobacco matched Altria's performance with a 5.1% gain over the same period [2] Strategic Initiatives - Altria is focusing on a smoke-free future, emphasizing harm reduction and innovative alternatives for adult smokers [10] - The NJOY brand has expanded its distribution to over 100,000 stores, achieving a 15% increase in consumable shipments, totaling 12.8 million units in the fourth quarter [11] - The on! brand, a tobacco-derived nicotine pouch, saw a 44% year-over-year growth in shipment volume, reaching nearly 44 million cans [12] - The "Optimize and Accelerate" initiative aims to modernize operations and achieve cost savings while maintaining pricing strength [13] Valuation - Altria is trading at a forward 12-month P/E of 10.74X, below the industry average of 13.80X, suggesting potential for upside as the company executes its growth strategy [14] Market Challenges - The e-vapor market is facing challenges from illicit flavored disposable products, which account for over 60% of the category, complicating Altria's efforts in the compliant e-vapor segment [17] - Domestic cigarette shipment volumes declined by 8.8% in the fourth quarter, reflecting broader industry challenges and retail share losses [18][19] Investment Outlook - Despite challenges, Altria's solid fundamentals and growth in the e-vapor market position the company for long-term success [20] - The stock appears undervalued compared to peers, presenting an attractive opportunity for long-term investors [21]