Group 1 - Altria Group, Inc. (NYSE: MO) is favored by many dividend investors and is also considered attractive for total return potential in a turbulent market environment [1] - The focus is on identifying companies with exceptional quality and a proven ability to reinvest capital for impressive returns, particularly those with a market capitalization of less than $10 billion [1] - The ideal companies should demonstrate long-term capital compounding capabilities with a high compound annual growth rate, potentially delivering tenfold returns or greater [1] Group 2 - A long-term investment perspective is maintained to generate higher returns compared to market indices, especially in a rapidly evolving investment landscape [1] - A conservative investment strategy is primarily adopted, with occasional pursuits of opportunities that present a favorable risk-reward ratio [1] - Careful consideration is given to these ventures, with proportional allocation within the portfolio to maintain overall stability [1]

Dividend Stocks Overview - Dividend yield is a key metric for investors, indicating how much a company pays in annual dividends relative to its stock price [1] - The sustainability of a company's dividend yield is often assessed through its dividend payout ratio, which shows the percentage of net income distributed as dividends [1][3] - A high dividend yield may result from a declining stock price, which could indicate underlying issues [2] Altria Group (MO) - Altria Group has a dividend yield of 6.83% and an annual dividend of $4.08, with a payout ratio of 68.34% [5][6] - The company has a strong track record of 56 consecutive years of dividend increases and an annualized 3-year dividend growth of 4.35% [5][8] - Despite the decline in traditional tobacco smoking, Altria is pivoting towards alternative nicotine products, which may support future revenue and earnings growth [7] - The stock has delivered a total return of over 609% in the last 15 years, and its current P/E ratio of 9x indicates it is undervalued compared to its historical performance [6][7] United Parcel Service (UPS) - UPS has a dividend yield of 6.88% and an annual dividend of $6.56, with a high payout ratio of 95.63% [9][10] - The company has a history of maintaining dividends even during economic downturns, with a cash flow payout ratio of 66% [10] - UPS is undergoing a turnaround plan that is expected to improve margins, and its P/E ratio is around 14x, which is a discount to historical averages [11] Verizon Communications (VZ) - Verizon has a dividend yield of 6.25% and an annual dividend of $2.71, with a payout ratio of 64.52% [12][14] - The company has a 20-year track record of dividend increases, but its recent total return over 10 years is only 45.22% [13][14] - Verizon is facing challenges with subscriber losses but has received FCC approval for a deal to acquire Frontier, which may enhance its competitive position [13][14]

Investment Rating - Industry rating is maintained as "Outperform the Market" [9] Core Insights - The new tobacco market continues to grow, with heated tobacco products leading in market size and nicotine pouches experiencing the fastest growth [2][3] - The global tobacco market is undergoing significant changes, with Japan's tobacco business expanding rapidly [4] - The global supply of tobacco leaves is facing shortages, leading to widespread price increases across the industry [14] Summary by Sections Electronic Cigarettes - In 2024, global e-cigarette sales are projected to reach $23.04 billion, a year-on-year increase of 9.5% [3] - Sales of disposable e-cigarettes grew by 18.9% to 840 million units, generating $6.42 billion in revenue, up 19.6% [3] - Open system e-cigarettes saw sales of 85.16 million devices and 12.23 million liters of e-liquid, with revenues of $2.62 billion and $5.49 billion respectively [3] Traditional Tobacco Products - Traditional oral tobacco products, including chewing and snuff tobacco, are experiencing a decline, with 2024 sales expected to drop by 0.8% to 115,000 tons [3] - Revenue from traditional oral tobacco is projected to decrease by 0.1% to $13.82 billion [3] Nicotine Pouches - Nicotine pouch sales are expected to grow by 36.9% to 21.23 billion pouches in 2024, with revenue reaching $11.25 billion, a 51.0% increase [3] - The United States leads in nicotine pouch sales with 13.88 billion pouches sold [3] Heated Tobacco Products - Sales of heated tobacco products are projected to grow by 12.7% to $38.85 billion in 2024 [3] - The volume of heated tobacco devices sold is expected to increase by 11.7% to 45.26 million units, with revenue rising by 14.7% to $2.44 billion [3] Company Performance - Philip Morris International reported a net income of $14.66 billion from its smoke-free products, a 14.2% increase, accounting for 38.7% of total revenue [5] - British American Tobacco's Vuse e-cigarette sales declined by 5.9% to 616 million units, impacted by illegal disposable e-cigarettes in the U.S. [6] - Japan Tobacco's Ploom brand heated tobacco sales grew by 24.2% to 218,000 boxes, primarily driven by the Ploom X model [7] Market Dynamics - The global tobacco market is experiencing intense competition, with multinational companies showing divergent growth patterns [4] - The supply chain for tobacco is under pressure due to climate-related shortages and rising prices [14]

Group 1 - The article introduces JB Analytics as a new contributing analyst for Seeking Alpha, encouraging individuals to share investment ideas and get published [1] - Jalwa Begum, the individual investor mentioned, has a Bachelor of Commerce and focuses on long-term value investing, particularly in sectors like technology, healthcare, consumer goods, and industrials [2] - The investment approach is influenced by classic value investors, seeking quality businesses trading below intrinsic value and emphasizing a long-term holding strategy [2] Group 2 - The article emphasizes the importance of thoughtful analysis and disciplined investment practices in navigating economic fluctuations [2] - It highlights the value of connecting with a community of like-minded investors to refine investment thinking and provide useful insights [2]

Company Overview - Altria Group is adapting to changing industry dynamics, focusing on expanding beyond traditional cigarettes into the smokeless category due to rising health consciousness and government regulations [11] - Revenues from the oral product category are steadily increasing, driven by the growing popularity of reduced-risk products [11] Investment Ratings - Altria has a Zacks Rank of 3 (Hold) and a VGM Score of A, indicating a solid position in the market [12] - The company is considered a potential top pick for growth investors, with a Growth Style Score of B, forecasting year-over-year earnings growth of 4.5% for the current fiscal year [12] Earnings Estimates - Four analysts have revised their earnings estimates higher in the last 60 days for fiscal 2025, with the Zacks Consensus Estimate increasing by $0.03 to $5.35 per share [12] - Altria has an average earnings surprise of 1.3%, suggesting a positive outlook for its earnings performance [12] Conclusion - With a solid Zacks Rank and strong Growth and VGM Style Scores, Altria is recommended for investors' consideration [13]

Core Viewpoint - Altria Group, Inc. and Philip Morris International Inc. are two leading players in the tobacco industry, with diverging strategies as they transition from traditional tobacco to reduced-risk products (RRPs) [1][2]. Altria Group, Inc. - Altria commands over 40% of the U.S. cigarette market, but faces declining cigarette volumes and reduced pricing power, with net revenues from smokeable products falling 5.8% to $4,622 million in Q1 2025 [5][6]. - The company is focusing on building a smoke-free portfolio, particularly in modern oral nicotine and vapor products, with its on! nicotine pouch seeing an 18% year-over-year growth in shipment volumes [6][7]. - Altria's e-vapor efforts have faced challenges, including the removal of NJOY ACE from the market due to regulatory issues, but the company aims to innovate and develop compliant vapor products [7][8]. - Operating solely in the U.S. presents both advantages and challenges, as regulatory pressures increase, limiting innovation and complicating execution [8]. Philip Morris International Inc. - Philip Morris is leading the global shift towards a smoke-free future, with its IQOS heat-not-burn device gaining traction in markets like Japan and Europe [9][10]. - The company has strengthened its smoke-free product portfolio through the acquisition of Swedish Match, enhancing its position in the oral nicotine segment [10][11]. - In Q1 2025, smoke-free products contributed 42% of total revenues and 44% of gross profit, with a 15% year-over-year revenue increase [11]. - Philip Morris benefits from a global footprint, allowing for better regulatory risk diversification and broader growth opportunities compared to Altria [12]. Financial Performance and Valuation - The Zacks Consensus Estimate for Philip Morris' 2025 EPS has increased by 3.3% to $7.47, indicating a projected growth of 13.7%, while Altria's estimate has risen by 1.3% to $5.35, reflecting a growth of 4.5% [13]. - Philip Morris trades at a forward P/E of 22.20x, while Altria trades at 10.97x, indicating that investors are willing to pay a premium for Philip Morris' growth visibility [14]. - Over the past year, Philip Morris' stock has gained 73.9%, outperforming Altria's 29.6% and the industry's 54.5%, showcasing investor confidence in its growth strategy [16]. Conclusion - Philip Morris stands out with its successful transition to RRPs, global diversification, and stronger earnings growth outlook, while Altria's U.S. market dominance is tempered by regulatory challenges and a slower transition to RRPs [17].

Group 1 - The focus is on growth and dividend income as a strategy for retirement planning [1] - The portfolio is structured to generate monthly dividend income that grows through reinvestment and annual increases [1] Group 2 - The article expresses personal opinions and is not intended as investment advice [2][3] - It emphasizes the importance of conducting individual research before making investment decisions [2]

| | ANNUAL MEETING OF SHAREHOLDERS | | | --- | --- | --- | | UAL MEETING OF SHAREHOLDERS | | lease limit | | | | possible, a | | Thursday, May 15, 2025 | Thursday, May 15, 2025 | al meeting | | 9:00 a.m. (Eastern Time) | 9:00 a.m. (Eastern Time) | | | AGENDA | RULES OF CONDUCT | d otherwise | | | | id to those | | | Welcome to Altria Group, Inc.'s 2025 Annual Meeting of Shareholders ("Annual Meeting"). It is | nformation | | | our goal to conduct a fair and informative Annual Meeting, and we ask that you ob ...

Financial Data and Key Metrics Changes - Altria reported that 80.28% of its common stock was represented at the annual meeting, indicating a quorum was present [8] - The preliminary voting results showed that over 96% of shares voted in favor of the election of directors and the selection of PricewaterhouseCoopers as the independent registered public accounting firm for 2025 [22][23] - Shareholders approved the compensation of named executive officers and the 2025 performance incentive plan with more than 95% of shares voting in favor [22][23] Business Line Data and Key Metrics Changes - The company emphasized its commitment to transitioning adult smokers to smoke-free products, aligning with societal demand and creating shareholder value [24] - Altria is focusing on a portfolio approach to meet consumer needs, with plans to enhance its product offerings in the smoke-free category [40][41] Market Data and Key Metrics Changes - The company noted that nicotine use among underage consumers is declining, and menthol cigarette use is at generational lows for 2024 [53] - Altria is monitoring the impact of tariffs on consumer behavior, indicating that current effects on cost inputs are immaterial [61] Company Strategy and Development Direction - Altria's vision is to responsibly lead the transition of adult smokers to a smoke-free future, which is seen as a significant opportunity for harm reduction [24][28] - The company is advocating for the FDA to expedite the authorization of new products to enhance its portfolio and meet consumer demands [59] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the FDA's ability to function as a regulatory body and the potential for a marketplace filled with authorized products [64] - The company remains committed to its vision despite challenges, emphasizing the importance of harm reduction and consumer transition to smoke-free alternatives [64] Other Important Information - Altria's corporate responsibility reporting highlights progress towards its vision of a smoke-free future [24] - The company has resources available for consumers who wish to quit using tobacco products [32] Q&A Session Summary Question: Do you ever feel sorry for all the lives lost and illnesses caused through the use of your tobacco products? - Management emphasized the importance of harm reduction and the transition to smoke-free products as a way to reduce risks associated with nicotine [27][28] Question: Shouldn't your focus be working on alternatives to addiction? - Management reiterated the commitment to transitioning adult smokers to smoke-free products while acknowledging the potential for harm reduction [29][30] Question: Were past statements about nicotine's addictiveness incorrect? - Management acknowledged nicotine's addictive nature and highlighted resources available for consumers wishing to quit [31][32] Question: How many families have to bury their loved ones before you admit profit matters above human life? - Management reiterated the belief in harm reduction and the potential benefits of transitioning to smoke-free products [33][34] Question: Why support someone already addicted to tobacco to start using more products that they could get addicted to? - Management pointed out the importance of providing options for consumers who wish to transition to less harmful products [35][36] Question: Are flavored tobacco products attractive to teens? - Management stated that they believe kids should not use tobacco products and highlighted efforts to prevent youth access [37][38] Question: What is the timeframe for harm reduction products to outsell traditional cigarettes? - Management indicated that it is difficult to pinpoint an exact date but emphasized the need to evolve with consumer preferences [40][42] Question: Will the company consider apologizing for past marketing practices? - Management stated that all marketing practices are committed to responsible marketing to adult consumers [43][44] Question: What will the dividend policy be going forward? - Management described a progressive dividend policy aiming for annual increases in the mid-single digits [48][49] Question: How are tariffs affecting Altria's business? - Management noted that tariffs currently have an immaterial impact on cost inputs but will continue to monitor consumer behavior [61] Question: Will Altria continue its efforts to create a smoke-free future despite FDA and CDC cuts? - Management affirmed the company's commitment to its vision and the importance of regulatory authorization for new products [64]

Altria Group Inc. (MO) saw its shares pull back 2.1% since reporting first-quarter 2025 results on April 30, 2025. This performance marks a notable underperformance compared to the Zacks Tobacco industry, which edged up 0.4%, the Zacks Consumer Staples sector, which slipped 0.4%, and the broader S&P 500, which advanced 2.1% during the same period.Among its tobacco peers, Turning Point Brands, Inc. (TPB) significantly outperformed, delivering a 17.9% return during this time. Meanwhile, major global competito ...