What's Next For MO Stock?

Core Insights - Altria reported Q4 results with revenues of $5.11 billion and adjusted earnings of$1.29 per share, slightly exceeding street estimates of $5.05 billion and$1.28 respectively [1][3][4] - The company experienced a 1.6% year-over-year revenue growth, driven by increasing sales of oral tobacco products, while smokeable products volume declined by 8.6% [3][4] - The outlook for 2025 adjusted earnings is $5.30, below the consensus estimate of$5.35, with concerns about the rise of illicit vaping products impacting business [5][8] Financial Performance - Altria's adjusted operating margin improved by 220 basis points for smokeable products and 640 basis points for oral tobacco products in Q4 [4] - The adjusted earnings reflected a 9.3% year-over-year change, indicating a positive trend despite low single-digit sales growth [4] Market Position - Altria's stock has returned 41% since the beginning of 2024, outperforming the S&P 500 index, which is up 27% [2][6] - The stock has shown volatility over the past four years, with returns of 24% in 2021, 4% in 2022, -4% in 2023, and 41% in 2024 [6] Competitive Landscape - Illicit vaping products now account for 60% of the vaping products market, creating challenges for Altria's compliant businesses [5] - The current stock price of $52 reflects a P/E ratio of 10.2x trailing earnings, slightly above the average P/E ratio of 9.5x over the last five years [8]