Altria (MO) Stock Sinks As Market Gains: What You Should Know
Altria (MO) closed at $38.70 in the latest trading session, marking a -1.23% move from the prior day. This change lagged the S&P 500's daily gain of 0.47%. At the same time, the Dow added 0.4%, and the tech-heavy Nasdaq gained 0.33%.
Prior to today's trading, shares of the owner of Philip Morris USA, the nation's largest cigarette maker had gained 0.93% over the past month. This has lagged the Consumer Staples sector's gain of 1.99% and the S&P 500's gain of 3.42% in that time.
MO will be looking to display strength as it nears its next earnings release, which is expected to be October 30, 2020. In that report, analysts expect MO to post earnings of $1.15 per share. This would mark year-over-year growth of 6.48%. Meanwhile, our latest consensus estimate is calling for revenue of $5.52 billion, up 2.02% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $4.32 per share and revenue of $20.49 billion, which would represent changes of +2.37% and +3.51%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for MO. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.32% higher within the past month. MO is currently a Zacks Rank #3 (Hold).
In terms of valuation, MO is currently trading at a Forward P/E ratio of 9.07. This represents a discount compared to its industry's average Forward P/E of 10.94.
Also, we should mention that MO has a PEG ratio of 2.27. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Tobacco industry currently had an average PEG ratio of 2.14 as of yesterday's close.
The Tobacco industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 122, which puts it in the top 49% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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