Stock Analysis: Altria Group

By Fredrik Arnold

Wednesday, December 7, 2022 11:32 PM EDT

Chart, Trading, Courses, Forex, Analysis

Image Source: Pixabay

Altria Group Inc bears the ticker symbol MO, andthis is my first mention of Altria for my new Viking Portfolio. However, I have previously selected MO for one or more of my previous seven Dog of The Week Portfolios.

Altria comprises Philip Morris USA, U.S. Smokeless Tobacco, John Middleton, Helix Innovations, and Philip Morris Capital, although the company plans to wind down Philip Morris Capital by the end of 2022.

Altria holds a 10% interest in the world's largest brewer, Anheuser-Busch InBev. Through its tobacco subsidiaries, Altria holds the leading position in cigarettes and smokeless tobacco in the United States and the number-two spot in machine-made cigars.

The company's Marlboro brand is the leading cigarette brand in the U.S. with a 43% share in 2020. Altria holds strategic investments in JUUL Labs (35% economic interest) and Cronos (42%).

It sells its tobacco products primarily to wholesalers, including distributors; and large retail organizations, such as chain stores.

Altria Group, Inc. was founded in 1822 and is headquartered in Richmond, Virginia.

Three key data points gauge

Altria Group Inc:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money.

MO Price

Altria’s price per share was $46.35 at Tuesday’s market close. And, in the past year, MO’s share price rose by $1.86 or about 4.2%.

If Altria’s stock trades in the range of $32.00 to $56.00 this next year, its recent $46.35 share price might reach $50.00 by next year. My upside increase estimate of $3.65 is $0.06 over the median one-year price target estimates from eighteen analysts.

MO Dividends

Altria’s most recently declared quarterly dividend of $0.94 per share, equals$3.76 annually and casts an annual yield of 8.11%.

MO Returns

Adding the $3.76 annual estimated MO dividend to my one-year price upside estimate of $3.65 reveals a $7.41 potential gross gain per share.

At Wednesday’s $46.35 closing price, a little over $1000 would buy 22 shares.

A $10 broker fee (if charged), paid half at purchase and half at sale, might cost us about $0.45 per share.

Subtract that maybe $0.45 brokerage cost from my estimated $7.41 gross gain makes a net gain of $6.96 X 22 shares = $153.12 for a 15.3% net gain including a 8.1% annual dividend yield.

In one year our $1K investment in shares of Altria Group Inc would generate $81.10 in cash dividends. Of course, a single share of MO stock at Wednesday's $46.35 price is almost 1.75 times less than the annual dividend income from our $1000.00 investment.

So, by my dogcatcher ideal, this is the time to buy MO’s shares based on their dividends for the coming year 2023. The current dividend from $1K invested is 1.749 times more than Altria’s single share price. Consider yourself alerted.

All of the estimates above are speculation based on the past history of Altria Group Inc. Only time and money invested in this stock will determine its market value.

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Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, ...

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