I was taking a quick look today at some positions and checking for ex-dividend dates. Then I noticed that Altria (MO) hit a 52-week low on 9/1. I did a double take because there was no way that Altria was trading poorly. The 52-week was on 9/1/10 not 9/1/11. So since that 52-week low of $22.58, the stock has appreciated 20% (actually 19.97%) to close Thursday at $27.09. Still the stock is off about 4% from its 52-week high. On top of all that, Altria shareholders scooped up another $1.52 in dividend over the last year.
You can hate cigarettes. You can hate beer, wine and cigars also. Just don’t hate Altria.
Where does the stock go from here? Certainly not down to its 52-week low. Rather I see the stock making a new 52-week high by the end of the year. A $30 price target by New Year’s Eve is a reasonable expectation.
The company’s board recently boosted the quarterly dividend by 7.89% to 41 cents. Act quickly because the stock goes ex-dividend on September 13. This implies a dividend yield of 6.05%. On average, Altria raises its dividend once per year, so by next time this year we should expect another bump in its payout.
I own the stock and strongly believe that it is a great antidote to the high volatility and low interest rate environment which were are ensconced in.
Disclosure: At the time of this Blog entry Scott Rothbort, his family and or clients of LakeView Asset Management, LLC was long MO stock --- although positions can change at any time.