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On Thursday, Stifel analysts reiterated their Buy rating on Philip Morris International Inc. (NYSE:PM) with a steady price target of $145.00. The tobacco giant, currently valued at over $203 billion, trades near its 52-week high of $134.15 and offers a 4.12% dividend yield. The affirmation follows the company’s fourth-quarter 2024 earnings report, which revealed earnings per share (EPS) of $1.55, surpassing Stifel’s estimate by $0.08. This increase included a $0.06 benefit from favorable foreign exchange rates.
Philip Morris International experienced a 9.6% growth in constant currency EPS and reported a 7.3% rise in organic revenue, buoyed by a 2.3% increase in volume and a 5% improvement from price and product mix. The company’s operating profit saw an 11.8% uptick on a constant currency basis, and margins expanded by 140 basis points. With an impressive gross profit margin of 64.07%, the company continues to demonstrate strong operational efficiency. Notably, smoke-free products accounted for 40% of the company’s revenue and 42% of its gross profit.According to InvestingPro, Philip Morris maintains a robust financial health score and offers 12 additional exclusive insights about the company’s performance and outlook.
Looking ahead to 2025, Philip Morris provided guidance anticipating 6%-8% growth in organic revenue and 10.5-12.5% growth in both organic operating income and constant currency EPS. The company expects heated tobacco unit (HTU) shipment volume to grow by approximately 10% to 12%, with total shipments aligning closely with this forecast, suggesting around 155 billion HTUs. Additionally, shipments of ZYN, a nicotine pouch brand, in the U.S. are projected to be between 780 and 820 million cans.
Stifel’s continued endorsement and the $145 target price reflect confidence in Philip Morris International’s performance and outlook, as the company progresses with its smoke-free product portfolio and financial growth objectives.
In other recent news, Philip Morris International Inc. has been the focus of several developments. The company’s shares saw an increase following the U.S. Food and Drug Administration’s (FDA) authorization of 20 ZYN nicotine pouch products, marking the first such approval for nicotine pouch products in the United States. This decision is expected to provide adult smokers with alternatives to traditional tobacco products.
In another development, Philip Morris and other tobacco companies such as British American Tobacco (NYSE:BTI) and Altria Group (NYSE:MO) saw their shares rise after the Trump administration withdrew a proposal that would have banned menthol cigarettes. This move is seen as a positive development for these companies, removing a significant regulatory risk.
Swedish Match, a subsidiary of Philip Morris, also received FDA authorization for a range of nicotine pouches. This is the first such approval for nicotine pouch products in the United States, aiming to provide adult smokers with alternatives to traditional tobacco products.
Meanwhile, Morgan Stanley (NYSE:MS) initiated coverage on Philip Morris shares, bestowing an Overweight rating and establishing a price target of $140. The move reflects the firm’s optimism about the tobacco company’s future performance, particularly due to its expanding smoke-free product portfolio.
Lastly, defensive stocks like Philip Morris registered gains in the latest trading session amid growing concerns over the impact of China’s DeepSeek on the tech sector. This surge reflects investor anxiety following the emergence of DeepSeek, a low-cost Chinese AI model, which has caused a significant drop in US tech stocks.
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