Philip Morris International (PM) and Altria Group (MO) have both released their 4Q17 earnings. In this series, we’ll analyze their performances during the quarter. We’ll look at their 4Q17 revenues, margins, and EPS (earnings per share). We’ll also cover management guidance and analyst estimates for 2018. Finally, we’ll look at the companies’ valuation multiples and analyst recommendations.
Performance of Philip Morris stock
In 4Q17, Philip Morris International (PM) posted adjusted EPS of $1.31 on net revenues, excluding excise taxes, of $8.3 billion. Analysts were expecting $1.36 on revenues of $8.2 billion. The better-than-expected 4Q17 revenue and an increase of 3.8% in total shipment volume appear to have increased investor confidence, leading to a rise in the company’s stock. As of March 15, 2018, Philip Morris was trading at $104.99, which represents a rise of 6.2% since the announcement of its 4Q17 earnings on February 8, 2018.
Performance of Altria stock
In 4Q17, Altria Group (MO) posted adjusted EPS of $0.91 on net revenues of $4.7 billion. Analysts were expecting the company to post EPS of $0.80 on revenues of $4.8 billion. The softness in sales of smokeable products lowered the company’s revenue, which led to a fall in its stock. As of March 15, 2018, Altria was trading at $63.81, which represents a fall of 4.5% since the announcement of its 4Q17 earnings on February 1, 2018.
Since the beginning of 2018, the stock prices of Philip Morris and Altria have fallen 0.6% and 10.6%, respectively. During the same period, its peer British American Tobacco (BTI) has fallen 12.6%. The broader comparative indexes, the S&P 500 Index and the Consumer Staples Select Sector SPDR ETF (XLP), have returned 2.8% and -6.0%, respectively, year-to-date.
Next, we’ll look at 4Q17 revenue for Philip Morris and Altria.