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How Has Philip Morris' Q4 Earnings Beat Impacted Staples ETFs?
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Philip Morris International Inc. (PM - Free Report) reported fourth-quarter 2021 results on Feb 10, before market open. The company’s earnings and revenues topped estimates. Moreover, the metrics rose year over year. Consequently, since the earnings release, Philip Morris’ shares have gained about 3.7%, as of Feb 11.
Q4 Performance in Detail
Philip Morris reported adjusted earnings per share (EPS) of $1.35, beating the Zacks Consensus Estimate of $1.30. Moreover, the bottom line climbed 7.1% year over year. Furthermore, the metric rose 11.9% on an organic basis.
Net revenues of $8.10 billion surpassed the Zacks Consensus Estimate of $7.72 billion. The top line rose 8.9% year over year and 8.4% on an organic basis.
During the reported quarter, Philip Morris witnessed favorable pricing variance and a positive volume/mix. The company gained from improved IQOS user growth, a better market share for cigarettes, portfolio enhancement efforts and reduced pandemic-led curbs in several markets.
Going on, adjusted operating income totaled $2.99 billion, up 4.5% year on year. The metric climbed 8.3% on an organic basis.
Shipment Volume
The company’s total cigarette and heated tobacco unit shipment volumes rose 4.2% to 183.8 billion units. While cigarette shipment volumes increased 2.4% to around 158.4 billion units in the fourth quarter, heated tobacco unit shipment volumes of almost 25.4 billion units reflected a year-over-year rise of 17%.
There was a decline in shipment volumes in Eastern Europe and South & Southeast Asia. In contrast, the same rose in East Asia & Australia, Eastern Union, Middle East & Africa, and America.
Guidance
Adjusted EPS for 2022 is projected in the $6.12-$6.30 range in comparison to $6.08 reported in 2021. Adjusted EPS, excluding currency impacts, is forecasted to increase 8-11% to the $6.57-$6.75 band. For the first quarter of 2022, Philip Morris expects reported EPS in the range of $1.50-$1.55, including adverse currency impacts of nearly 15 cents per share.
Phillip Morris expects continued uncertainty with regard to the recovery pace from the pandemic-led operating landscape in this year. For 2022, the company expects adjusted net revenues to increase nearly 4-6% on an organic basis. Adjusted operating margin on an organic basis is likely to expand 50-150 basis points (bps) in 2022. This is likely to be backed by a continued favorable product mix shift from cigarettes to smoke-free products along with increased operating efficacy. Total cigarette and heated tobacco unit shipment volume growth in 2022 is likely to come in the range of decline 1% to increase 1%. Heated tobacco shipment volumes are envisioned between 113 and 118 billion units.
ETF Impact
Here we highlight some consumer staples ETFs with significant exposure to Philip Morris since its earnings release:
Fidelity MSCI Consumer Staples Index ETF (FSTA - Free Report)
This fund offers exposure to the U.S. Consumer Staples sector at a very low expense ratio. It has AUM of $978.3 million and charges a fee of 8 bps a year. It has 4.85% exposure to Philip Morris. Since the earnings release, the fund has lost about 1.2% (as of Feb 11) (see all Consumer Staples ETFs here).
This ETF tracks the Russell 1000 Consumer Staples RIC 22.5/45 Capped Index, giving investors exposure to the U.S. companies that produce a wide range consumer goods, including food, automobiles, and household goods. It has AUM of $912.9 million and charges a fee of 41 bps a year, as stated in the prospectus. It has 7.57% exposure to Philip Morris. Since the earnings release, the fund has lost about 0.8% (read: 5 Sector ETFs That Outperformed in January).
This fund is one of the most popular in the U.S. consumer staples sector. It has AUM of $6.69 billion and charges a fee of 10 bps a year. It has 4.4% exposure to Philip Morris. Since the earnings release, the fund has lost about 1.4% (read: Bet on These 5 ETFs to Combat the Current Market Tantrums).
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How Has Philip Morris' Q4 Earnings Beat Impacted Staples ETFs?
Philip Morris International Inc. (PM - Free Report) reported fourth-quarter 2021 results on Feb 10, before market open. The company’s earnings and revenues topped estimates. Moreover, the metrics rose year over year. Consequently, since the earnings release, Philip Morris’ shares have gained about 3.7%, as of Feb 11.
Q4 Performance in Detail
Philip Morris reported adjusted earnings per share (EPS) of $1.35, beating the Zacks Consensus Estimate of $1.30. Moreover, the bottom line climbed 7.1% year over year. Furthermore, the metric rose 11.9% on an organic basis.
Net revenues of $8.10 billion surpassed the Zacks Consensus Estimate of $7.72 billion. The top line rose 8.9% year over year and 8.4% on an organic basis.
During the reported quarter, Philip Morris witnessed favorable pricing variance and a positive volume/mix. The company gained from improved IQOS user growth, a better market share for cigarettes, portfolio enhancement efforts and reduced pandemic-led curbs in several markets.
Going on, adjusted operating income totaled $2.99 billion, up 4.5% year on year. The metric climbed 8.3% on an organic basis.
Shipment Volume
The company’s total cigarette and heated tobacco unit shipment volumes rose 4.2% to 183.8 billion units. While cigarette shipment volumes increased 2.4% to around 158.4 billion units in the fourth quarter, heated tobacco unit shipment volumes of almost 25.4 billion units reflected a year-over-year rise of 17%.
There was a decline in shipment volumes in Eastern Europe and South & Southeast Asia. In contrast, the same rose in East Asia & Australia, Eastern Union, Middle East & Africa, and America.
Guidance
Adjusted EPS for 2022 is projected in the $6.12-$6.30 range in comparison to $6.08 reported in 2021. Adjusted EPS, excluding currency impacts, is forecasted to increase 8-11% to the $6.57-$6.75 band. For the first quarter of 2022, Philip Morris expects reported EPS in the range of $1.50-$1.55, including adverse currency impacts of nearly 15 cents per share.
Phillip Morris expects continued uncertainty with regard to the recovery pace from the pandemic-led operating landscape in this year. For 2022, the company expects adjusted net revenues to increase nearly 4-6% on an organic basis. Adjusted operating margin on an organic basis is likely to expand 50-150 basis points (bps) in 2022. This is likely to be backed by a continued favorable product mix shift from cigarettes to smoke-free products along with increased operating efficacy. Total cigarette and heated tobacco unit shipment volume growth in 2022 is likely to come in the range of decline 1% to increase 1%. Heated tobacco shipment volumes are envisioned between 113 and 118 billion units.
ETF Impact
Here we highlight some consumer staples ETFs with significant exposure to Philip Morris since its earnings release:
Fidelity MSCI Consumer Staples Index ETF (FSTA - Free Report)
This fund offers exposure to the U.S. Consumer Staples sector at a very low expense ratio. It has AUM of $978.3 million and charges a fee of 8 bps a year. It has 4.85% exposure to Philip Morris. Since the earnings release, the fund has lost about 1.2% (as of Feb 11) (see all Consumer Staples ETFs here).
iShares U.S. Consumer Staples ETF (IYK - Free Report)
This ETF tracks the Russell 1000 Consumer Staples RIC 22.5/45 Capped Index, giving investors exposure to the U.S. companies that produce a wide range consumer goods, including food, automobiles, and household goods. It has AUM of $912.9 million and charges a fee of 41 bps a year, as stated in the prospectus. It has 7.57% exposure to Philip Morris. Since the earnings release, the fund has lost about 0.8% (read: 5 Sector ETFs That Outperformed in January).
Vanguard Consumer Staples ETF (VDC - Free Report)
This fund is one of the most popular in the U.S. consumer staples sector. It has AUM of $6.69 billion and charges a fee of 10 bps a year. It has 4.4% exposure to Philip Morris. Since the earnings release, the fund has lost about 1.4% (read: Bet on These 5 ETFs to Combat the Current Market Tantrums).