As of July 18, 2017, Altria Group (MO) was trading at $73.33. The stock price may have considered analysts’ estimates, as discussed earlier. In this article, we’ll look at analysts’ target price and recommendations.
The expansion of Nu-Mark products, the acquisition of Nat Sherman, and the FDA’s announcement regarding the substantive science review of Altria’s modified risk tobacco product may have compelled analysts to raise their target price. As of July 18, 2017, analysts expect Altria’s stock price to reach $74.23 in the next 12 months, which represents a potential return of 1.2%. Before the 1Q17 earnings release, analysts had forecast a target price of $73.20.
Peers’ target prices and potential returns are as follows:
- Philip Morris International (PM) has a target price of $123.71, with a return potential of 3.4%
- Reynolds American (RAI) has a target price of $62.95, 3.2% lower than its current stock price
Of the 14 analysts following Altria, 42.9% recommend “buy,” 50.0% recommend “hold,” and 7.1% recommend “sell.” On July 17, 2017, Jefferies lowered its target price from $71 to $70, while maintaining its “hold” rating. On May 25, 2017, Piper Jaffray initiated its coverage of Altria with a price target of $76 and an “overweight” rating.
Altria’s stock price moves in tandem with analysts’ ratings. When they raise their target price, the stock rises, and vice versa. A stock price lower than analysts’ target price does not mean an automatic “buy.” Investors should carefully analyze various parameters before making investment decisions.