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Philip Morris (PM) Outpaces Stock Market Gains: What You Should Know

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In the latest trading session, Philip Morris (PM - Free Report) closed at $106.37, marking a +0.81% move from the previous day. This change outpaced the S&P 500's 0.31% gain on the day. Elsewhere, the Dow gained 0.05%, while the tech-heavy Nasdaq added 0.14%.

Coming into today, shares of the seller of Marlboro and other cigarette brands had gained 6.65% in the past month. In that same time, the Consumer Staples sector lost 0.14%, while the S&P 500 lost 1.38%.

Investors will be hoping for strength from Philip Morris as it approaches its next earnings release, which is expected to be July 21, 2022. On that day, Philip Morris is projected to report earnings of $1.22 per share, which would represent a year-over-year decline of 22.29%. Meanwhile, our latest consensus estimate is calling for revenue of $6.48 billion, down 14.64% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.50 per share and revenue of $28.98 billion. These totals would mark changes of -9.54% and -7.72%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Philip Morris. These revisions help to show the ever-changing nature of near-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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

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 0.53% lower. Philip Morris currently has a Zacks Rank of #3 (Hold).

Investors should also note Philip Morris's current valuation metrics, including its Forward P/E ratio of 19.19. Its industry sports an average Forward P/E of 9.76, so we one might conclude that Philip Morris is trading at a premium comparatively.

Meanwhile, PM's PEG ratio is currently 3.74. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Tobacco stocks are, on average, holding a PEG ratio of 1.94 based on yesterday's closing prices.

The Tobacco industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 106, putting it in the top 42% 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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