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Altria on the Street: What Analysts Recommend before Its 1Q17 Earnings

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Apr. 28 2017, Updated 9:36 a.m. ET

Target price

As of April 25, 2017, Altria Group (MO) was trading at $72.38. The stock price might have factored in the various estimates we’ve discussed in this series. In this article, we’ll look at the analysts’ recommendations and target prices for next 12-months.

Altria’s strong 4Q16 earnings and the expansion of its Nu-Mark products appear to have compelled analysts to raise their target prices for the stock for the next 12 months. As of April 25, 2017, analysts are expecting Altria to reach $73.18 in the next 12 months, which represents a return potential of 1% from its current stock price.

Below are the return potentials for Altria’s peers for the next 12 months:

  • Philip Morris International (PM) has a target price of $117.80, with a return potential of 4.2%.
  • Reynolds American (RAI) has a target price of $59.91, with a return potential of -7.6%.
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Analysts’ recommendations

Of the 13 analysts following Altria, 38.5% are recommending a “buy,” while 53.8% are recommending “hold,” and 7.7% are recommending “sell.” On March 23, 2017, the Royal Bank of Canada downgraded the stock from “sector perform” to “underperform.” On March 3, 2017, Berenberg Bank had also downgraded the stock from “buy” to “hold.”

Remember, Altria’s stock will move in tandem with analysts’ estimates. When an analyst raises her price target, the stock should rise, and vice versa. Also, when a target price is higher than the current stock price, it does not mean an automatic “buy” for investors. Investors should carefully analyze the various parameters that we’ve discussed in this series before making investment decisions.

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