Altria's Problems Go Deeper Than Just Falling Tobacco Sales

Core Viewpoint - Smoking rates have been declining significantly, impacting companies like Altria that rely heavily on smokeable products for revenue [1][2] Group 1: Market Trends - Smoking rates among adults fell to less than 12% in 2022 from nearly 43% in 1965, indicating a long-term trend towards reduced tobacco use [1] - The e-vapor market expanded by 30% last year, but the illicit market holds a 60% share, complicating growth for legitimate companies [3] Group 2: Company Performance - Altria's smokeable tobacco products generated $5.3 billion in revenue, accounting for 88$19 million in revenue, highlighting the need for more substantial growth initiatives [7] Group 3: Investment Considerations - Altria's dividend yield is 7.8%, significantly higher than the S&P 500 average of 1.2%, but the sustainability of this dividend is questionable given the company's challenges [8] - The stock trades at 8 times its trailing earnings, which may appear attractive, but declining revenues could lead to a reassessment of its value, suggesting it may be a potential value trap [9]