Altria(US:MO) ZACKS·2025-10-13 15:31Core Insights - Altria Group, Inc.'s oral tobacco business is experiencing strong profitability, with adjusted operating companies income (OCI) margins increasing to 68.7% in Q2 2025, a rise of 3.1 percentage points year-over-year [1][8] - The growth driver is the on! nicotine pouches, which saw a volume increase of 26.5%, compensating for declines in traditional moist smokeless tobacco (MST) brands [2][8] - Sustaining profitability will depend on product mix, competitive pressures, and pricing dynamics in the nicotine pouch category [3][4] Oral Tobacco Business Performance - Altria's oral tobacco segment demonstrates strong operating efficiency despite a 1% dip in total shipment volumes [1][4] - The adjusted OCI increased by 10.9% due to strong pricing and cost efficiencies [2] - The share of on! in the nicotine pouch segment decreased by 2.3 percentage points to 16.7%, while its share in the total U.S. oral tobacco category rose to 8.7% [3] Competitive Landscape - Philip Morris International Inc. reported an adjusted operating income margin of 41.9% in Q2 2025, highlighting effective global pricing and cost management strategies [5] - Turning Point Brands, Inc. achieved a Stoker's products segment adjusted operating income margin of 44.3%, reflecting strong manufacturing efficiency and pricing power [6] Stock Performance and Valuation - Altria's shares have increased by 2.5% over the past month, contrasting with a 1.8% decline in the industry [7] - The forward price-to-earnings ratio for Altria is 12.02X, lower than the industry average of 14.68X [10] - Zacks Consensus Estimate indicates year-over-year earnings growth of 6.1% for 2025 and 2.5% for 2026 [11]