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Philip Morris (PM) Gains As Market Dips: What You Should Know

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Philip Morris (PM - Free Report) closed at $102.10 in the latest trading session, marking a +0.65% move from the prior day. This move outpaced the S&P 500's daily loss of 1.42%. Meanwhile, the Dow lost 0.49%, and the Nasdaq, a tech-heavy index, lost 0.47%.

Coming into today, shares of the seller of Marlboro and other cigarette brands had gained 9.39% in the past month. In that same time, the Consumer Staples sector gained 4.57%, while the S&P 500 gained 0.39%.

Wall Street will be looking for positivity from Philip Morris as it approaches its next earnings report date. In that report, analysts expect Philip Morris to post earnings of $1.32 per share. This would mark year-over-year growth of 4.76%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.84 billion, up 5.3% from the year-ago period.

Investors should also note any recent changes to analyst estimates for Philip Morris. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.51% lower. Philip Morris is currently sporting a Zacks Rank of #4 (Sell).

In terms of valuation, Philip Morris is currently trading at a Forward P/E ratio of 15.98. Its industry sports an average Forward P/E of 9.85, so we one might conclude that Philip Morris is trading at a premium comparatively.

It is also worth noting that PM currently has a PEG ratio of 2.03. 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 was holding an average PEG ratio of 2.03 at yesterday's closing price.

The Tobacco industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 232, which puts it in the bottom 10% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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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