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Tobacco Stocks Releasing Earnings this Week: MO, VGR
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The Q2 earnings season is in full swing with almost 32.7% of the total S&P 500 members already having reported their quarterly results. Per the Earnings Trends report, though earnings have improved sequentially, the quarter is still expected to be the fifth consecutive quarter to report earnings decline.
There have been very few positive surprises till now in Q2, which can be explained by the fact that analysts had kept their expectations high during the quarter.
The Q2 earnings season is critical for investors to ascertain the most attractive picks as the market has begun to stabilize after Brexit, which shook the global economy in Jun 2016. Post Brexit, investors have become jittery and are resorting to safe haven stocks. In such a scenario, the consumer staples sector might be quite reliable.
Though total earnings for the sector are expected to dip 3.7% due to 0.5% lower margins, the sector might prove to be profitable in the long term. In spite of the declining trend, the tobacco industry is smoking hot in this quarter. Although the entire world is engaging in anti-smoking campaigns, cigarette companies are on fire. Lower gas prices, an improving job scenario and increasing consumer spending power boosted the economy and did the trick for these stocks. Plus, these companies will always benefit from the addictive nature of tobacco.
Let’s take a look at what’s in store for the two tobacco majors scheduled to release their Q2 numbers this week.
Altria Group Inc. (MO - Free Report) is set to report Q2 results before the market opens on Jul 27. It has an Earnings ESP of -1.25% and a Zacks Rank #2 (Buy). The Zacks Consensus Estimate is pegged at 80 cents for Q2.
Last quarter, Altria posted a positive earnings surprise of 5.88%. The company beat estimates in two of the last four quarters with an average positive surprise of 1.47%.
Altria started 2016 on a strong note with both its top line and bottom line improving year over year in the first quarter on higher shipments and retail share gains by its flagship brand, Marlboro. The trend is expected to continue in Q2 also.
However, headwinds like the shift in consumers away from tobacco products amid increasing cigarette prices, as well as the rise in worldwide anti-tobacco campaigns, are likely to weigh on Altria’s Q2 volumes. (Read more: Will Q2 Earnings Hold a Surprise for Altria Stock?)
Another tobacco giant, Vector Group Limited (VGR - Free Report) , is also slated to report its Q2 results before the market opens on Jul 28. It has an Earnings ESP of 0.00% and a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for is pegged at 22 cents for Q2.
Last quarter, Vector Group’s results were in line with estimates. Notably, Vector Group’s earnings met estimates in two quarters and missed expectations in the other two, with an average negative surprise of 18.06%.
Stay tuned! Check later on our full write-up on earnings releases of these stocks.
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Tobacco Stocks Releasing Earnings this Week: MO, VGR
The Q2 earnings season is in full swing with almost 32.7% of the total S&P 500 members already having reported their quarterly results. Per the Earnings Trends report, though earnings have improved sequentially, the quarter is still expected to be the fifth consecutive quarter to report earnings decline.
There have been very few positive surprises till now in Q2, which can be explained by the fact that analysts had kept their expectations high during the quarter.
The Q2 earnings season is critical for investors to ascertain the most attractive picks as the market has begun to stabilize after Brexit, which shook the global economy in Jun 2016. Post Brexit, investors have become jittery and are resorting to safe haven stocks. In such a scenario, the consumer staples sector might be quite reliable.
Though total earnings for the sector are expected to dip 3.7% due to 0.5% lower margins, the sector might prove to be profitable in the long term. In spite of the declining trend, the tobacco industry is smoking hot in this quarter. Although the entire world is engaging in anti-smoking campaigns, cigarette companies are on fire. Lower gas prices, an improving job scenario and increasing consumer spending power boosted the economy and did the trick for these stocks. Plus, these companies will always benefit from the addictive nature of tobacco.
Let’s take a look at what’s in store for the two tobacco majors scheduled to release their Q2 numbers this week.
Altria Group Inc. (MO - Free Report) is set to report Q2 results before the market opens on Jul 27. It has an Earnings ESP of -1.25% and a Zacks Rank #2 (Buy). The Zacks Consensus Estimate is pegged at 80 cents for Q2.
Last quarter, Altria posted a positive earnings surprise of 5.88%. The company beat estimates in two of the last four quarters with an average positive surprise of 1.47%.
ALTRIA GROUP Price and EPS Surprise
ALTRIA GROUP Price and EPS Surprise | ALTRIA GROUP Quote
Altria started 2016 on a strong note with both its top line and bottom line improving year over year in the first quarter on higher shipments and retail share gains by its flagship brand, Marlboro. The trend is expected to continue in Q2 also.
However, headwinds like the shift in consumers away from tobacco products amid increasing cigarette prices, as well as the rise in worldwide anti-tobacco campaigns, are likely to weigh on Altria’s Q2 volumes. (Read more: Will Q2 Earnings Hold a Surprise for Altria Stock?)
Another tobacco giant, Vector Group Limited (VGR - Free Report) , is also slated to report its Q2 results before the market opens on Jul 28. It has an Earnings ESP of 0.00% and a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for is pegged at 22 cents for Q2.
VECTOR GRP LTD Price and EPS Surprise
VECTOR GRP LTD Price and EPS Surprise | VECTOR GRP LTD Quote
Last quarter, Vector Group’s results were in line with estimates. Notably, Vector Group’s earnings met estimates in two quarters and missed expectations in the other two, with an average negative surprise of 18.06%.
Stay tuned! Check later on our full write-up on earnings releases of these stocks.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>