Altria: Investors Overreact As Volume Declines Normalized Upwards In Q3

Oct 28, 2021

∙ Paid

Altria stock is currently down 4.4% after Q3 results. This means a 7.9% Dividend Yield and a 20%+ annualized return in our forecasts.
Reported cigarette volumes fell 12.9% year-on-year, due to inventory moves, a reversal of COVID benefits and higher gasoline prices.
We believe the U.S. cigarette market remains fundamentally stable; e-vapor volume growth has remained in 2021 year-to-date.
In Oral Tobacco, Altria has stabillized its volume share at the cost of lower EBIT. This has only 13% of total EBIT and limited impact on the group.
With shares at $45.35, we expect a total return of 71% (20.5% annualized) by 2024 year-end on just 4% Net Income growth. Buy.

Altria Group Inc. released Q3 2021 results this morning. Shares are currently down 4.4% at $45.35 at the time of writing (as of 11 am EST).

Q3 2021 results contained several disappointing headlines, including:

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