Seeking Alpha
Profile| Send Message|
( followers)  

Lorillard, Inc., through its Lorillard Tobacco Company subsidiary, is the third largest manufacturer of cigarettes in the United States. Founded in 1760, Lorillard is the oldest continuously operating tobacco company in the U.S. Newport, Lorillard's flagship menthol-flavored premium cigarette brand, is the top selling menthol and second largest selling cigarette in the U.S.

In addition to Newport, the Lorillard product line has four additional brand families marketed under the Kent, True, Maverick and Old Gold brand names. These five brands include 43 different product offerings which vary in price, taste, flavor, length and packaging. Lorillard maintains its headquarters and manufactures all of its products in Greensboro, North Carolina.

Reasons to be bullish on Lorillard, Inc Common Stock (NYSE:LO):

  • It is the 3rd largest cigarette producer in the US; it has a strong and flexible balance sheet, produces boat loads of free cash and earnings.
  • It has a strong free cash flow of $1.12 billion.
  • A dividend yield of 4.8%
  • Earnings per share are projected to increase from $7.88 in 2011, to $8.92 in 2012 to $9.87 in 2013.
  • Net income has been rising for the past three years
  • It has a five year dividend yield of 4.44%
  • A strong five year dividend growth of 29.76%
  • A current ratio of 1.73
  • A strong ROI of 92%
  • A decent payout ratio of 70%
  • A decent quick ratio of 1.54
  • Sales have risen nicely over the past three years from $5.2 billion in 2009 to $6.4 billion in 2011.
  • A strong interest coverage ratio of 15.14
  • A 5 year average payout ratio of 60%
  • 4th quarter adjusted (Non-GAP) diluted earnings per share increased 26.4% compared to last year.
  • 4th quarter (GAAP) diluted earnings per share increased 33.3% versus last year to 2.32 and annual diluted earnings per share increased 17.8% to $7.99.
  • Net sales in the 4th quarter increased by 8.9% to $1.61 billion; annual sales increased by 9% to $6.45 billion.
  • LO approved a 19% increase in its quarterly dividend from $1.30-$1.55 per share.
  • It continues to gain market share in a declining industry. Newport is the largest menthol brand in the US. Its domestic market share climbed 0.8 points and now stands at 14% in the 4th quarter. For 2011, its share soared to 14.1%. Its brand name enables it to charge premium prices, which add to profitability.
  • The launch of the new port Non-menthol brand appears to be well received and should contribute to the bottom line and help it increase local market share.
  • It repurchases 3.3 million shares in the 4th quarter at a cost of $366 million, under the $750 million program that it announced in August of 2011.
  • It has a decent free cash flow yield of 6.5%
  • It also sports a revenue growth rate of 8.89%
  • 100K invested for 10 years would have grown to 472K.

A lot of key ratios will be mentioned throughout this article, and investors would do better to get a handle on them; some of the more important ones have been listed below. A significant portion of the historical data used in this article was obtained from zacks.com

Free cash flow yield is obtained by dividing free cash flow per share by the current price of each share. Generally lower ratios are associated with an unattractive investment and vice versa. Free cash flow takes into account capital expenditures and other ongoing costs associated with the day to day to functions of the business. In our view free cash flow yield is a better valuation metric then earnings yield because of the above factor

Levered free cash flow is the amount of cash available to stock holders after interest payments on debt are made. A company with a small amount of debt will only have to spend a modest amount of money on interest payments, which in turn means that there is more money to send to shareholders in the form of dividends and vice versa.

Operating cash flow is generally a better metric than earnings per share because a company can show positive net earnings and still not be able to properly service its debt; the cash flow is what pays the bills.

The payout ratio tells us what portion of the profit is being returned to investors. A payout ratio over 100% indicates that the company is paying out more money to shareholders than they are making; this situation cannot last forever. In general if the company has a high operating cash flow and access to capital markets, they can keep this going on for a while. As companies usually only pay the portion of the debt that is coming due and not the whole debt, this technique/trick can technically be employed to maintain the dividend for sometime. If the payout ratio continues to increase, the situation warrants close monitoring. If your tolerance for risk is a low, look for similar companies with the same or higher yields, but with lower payout ratios. Individuals searching for other ideas might find this article to be of interest: Sherwin Williams: An Interesting Dividend Play?

Debt to Equity Ratio is found by dividing the company's total amount of long-term debt (debts with interest rates that have a maturity longer than one year) by the total amount of equity. A debt to equity ratio of 0.5 tells us that the company is using 50 cents of liabilities in addition to each $1 dollar of shareholders equity in the business. There is no fixed ideal number as it depends on the industry the company is in. However, in general a ratio under 1 is acceptable and ideally it should be in the 0.5-0.6 ranges.

Current Ratio is obtained by dividing the current assets by current liabilities. This ratio allows you to see if the company can pay its current debts without potentially jeopardising their future earnings. Ideally the company should have a ratio of 1 or higher.

Price to cash flow ratio is obtained by dividing the share price by cash flow per share. It is a measure of the market's expectations of a company's future financial health. The effects of depreciation and other non cash factors are removed, and this makes it easier for investors to assess foreign companies in the same industry. This ratio also provides a measure of relative value like the price to earning's ratio.

Price to free cash flow is obtained by dividing the share price by free cash flow per share. Higher ratios are associated with more expensive companies and vice versa; lower ratios are generally more attractive. If a company generated 400 million in cash flow and then spent 100 million on capital expenditure, then its free flow is $300 million. If the share price is 100 and the free cash flow per share are $5, then company trades at 20 times-free cash flow. This ratio is also useful because it can be used as a comparison to the average within the industry; this gives you an idea of how the company you are interested in holds up to the other companies within the industry.

Interest coverage is usually calculated by dividing the earnings before interest and taxes for a period of 1 year by the interest expenses for the same time period. This ratio informs you of a company's ability to make its interest payments on its outstanding debt. Lower interest coverage ratios indicate that there is a larger debt burden on the company and vice versa. For example, if a company has an interest ratio of 11.8, this means that it covers interest expenses 11.8 times with operating profits.

Price to tangible book is obtained by dividing share price by tangible book value per share. The ratio gives investors some idea of whether they are paying too much for what would be left over if the company were to declare bankruptcy immediately. In general stocks that trade at higher price to tangible book value could leave investors facing a great percentage per share loss than those that trade at lower ratios. The price to tangible book value is theoretically the lowest possible price the stock would trade to

Quick ratio or acid test is obtained by adding cash and cash equivalents plus marketable securities and accounts receivable dividing them by current liabilities. It is a measure of a company's ability to use its quick assets (assets that can be sold of immediately at close to book value) to pay off its current liabilities immediately. A company with a quick ratio of less than 1 cannot pay back its current liabilities. Additional key metrics are addressed in this article Teva Pharmaceutical Industries, A Great Long-Term play.

Company: Lorillard

Free Cash Flow = $1.12 billion

Basic Key ratios

Percentage Held by Insiders = 0.33

Market Cap ($mil) = 17424

Number of Institutional Sellers 12 Weeks = N/A

3 Month % Chg Short Interest = n/a

Growth

Net Income ($mil) 12/2011 = 1116

Net Income ($mil) 12/2010 = 1029

Net Income ($mil) 12/2009 = 948

12mo Net Incm this Q/ 12mo Net Incm 4Q's ago = 8.56

Q Net Incm this Q/ same qtr yr ago = 19.69

EBITDA ($mil) 12/2011 = N/A

EBITDA ($mil) 12/2010 = 1764

EBITDA ($mil) 12/2009 = 1578

Net Incm Rpt Qtr ($mil) = 310

Anl Net Incm this Yr/ Net Incm last Yr = 8.46

Cash Flow ($/sh) 12/2011 = N/A

Cash Flow ($/sh) 12/2010 = 7.11

Cash Flow ($/sh) 12/2009 = 6.1

Div 5yr Growth 12/2011 = 29.76

Sales ($mil) 12/2011 = 6466

Sales ($mil) 12/2010 = 5932

Sales ($mil) 12/2009 = 5233

Dividend history

Div Yield = 4.03

Div Yld 5 Yr Avg 12/2011 = 4.44

Div Yld 5 Yr Avg 09/2011 = 4.36

Annual Dividend 12/2011 = 5.2

Annual Dividend 12/2010 = 4.25

Forward Yield = 4.8

Div 5yr Growth 12/2011 = 29.76

R-squared Div Growth 12/2011 = 0.85

R-squared Div Growth 09/2011 = 0.86

Dividend sustainability

Payout Ratio 09/2011 = 0.7

Payout Ratio 06/2011 = 0.71

Payout Ratio 5 Yr Avg 12/2011 = 0.6

Payout Ratio 5 Yr Avg 09/2011 = 0.59

Payout Ratio 5 Yr Avg 06/2011 = 0.57

Change in Payout Ratio = 0.06

Performance

% Ch Price 52 Wks Rel to S&P 500 = 57.52

Std Dev Target Price Est = 12.05

Avg EPS Surprise Last 4 Qtr = 4.44

EPS % Change F2/F1 = 10.71

Next 3-5 Yr Est EPS Gr rate = 7

Std Dev 3-5 Yr Est EPS Gr rate = N/A

EPS Gr Q(1)/Q(-3) = -126.44

5 Yr Hist EPS Gr 12/2011 = 12.03

5 Yr Hist EPS Gr 09/2011 = 11.52

ROE 5 Yr Avg 12/2011 = N/A

ROE 5 Yr Avg 09/2011 = N/A

ROE 5 Yr Avg 06/2011 = N/A

Return on Investment 12/2011 = 92.58

Return on Investment 09/2011 = 81.63

Return on Investment 06/2011 = 76.83

Debt/Tot Cap 5 Yr Avg 12/2011 = N/A

Debt/Tot Cap 5 Yr Avg 09/2011 = N/A

Debt/Tot Cap 5 Yr Avg 06/2011 = N/A

Current Ratio 12/2011 = 1.73

Current Ratio 09/2011 = 1.93

Current Ratio 06/2011 = 1.75

Curr Ratio 5 Yr Avg = 1.85

Quick Ratio = 1.54

Cash Ratio = 1.48

Interest Coverage 12/2011 = 15.14

Interest Coverage 09/2011 = 13.38

Interest Coverage 06/2011 = 17.43

Valuation

Book Value Qtr ($/sh) 12/2011 = -11.21

Book Value Qtr ($/sh) 09/2011 = -8.48

Book Value Qtr ($/sh) 06/2011 = -5.78

Anl EPS before NRI 12/2007 = 4.91

Anl EPS before NRI 12/2008 = 5.15

Anl EPS before NRI 12/2009 = 5.76

Anl EPS before NRI 12/2010 = 6.78

Anl EPS before NRI 12/2011 = 7.88

Price/ Book = N/A

Price/ Cash Flow = 18.15

Price/ Sales = 2.69

EV/EBITDA 12 Mo = 10.42

P/E/G F1 = 2.07

Q1 Std Dev/ Consensus = 0.03

R-squared EPS Growth 12/2011 = 0.94

R-squared EPS Growth 09/2011 = 0.94

P/E F1/ LT EPS Gr = 2.07

Std Dev Cons Current Qtr = 0.07

Median Est Next Qtr = 2.32

# Anlst in Cons Q3 = 7

Other interesting companies

Company: Toronto-Dominion Bank (NYSE:TD)

Free Cash Flow = $-1.07 billion

Basic Key ratios

Percentage Held by Insiders = N/A

Market Cap ($mil) = 72969

Number of Institutional Sellers 12 Weeks = N/A

3 Month % Chg Short Interest = n/a

Growth

Net Income ($mil) 12/2011 = 5972

Net Income ($mil) 12/2010 = 4474

Net Income ($mil) 12/2009 = 2679

12mo Net Incm this Q/ 12mo Net Incm 4Q's ago = 33.39

Q Net Incm this Q/ same qtr yr ago = 57.92

EBITDA ($mil) 12/2011 = 9702

EBITDA ($mil) 12/2010 = 7935

EBITDA ($mil) 12/2009 = 5293

Net Incm Rpt Qtr ($mil) = 1536

Anl Net Incm this Yr/ Net Incm last Yr = 33.47

Cash Flow ($/sh) 12/2011 = 8.25

Cash Flow ($/sh) 12/2010 = 7.16

Cash Flow ($/sh) 12/2009 = 6.56

Div 5yr Growth 12/2011 = 6.86

Sales ($mil) 12/2011 = 26704

Sales ($mil) 12/2010 = 24866

Sales ($mil) 12/2009 = 24292

Dividend history

Div Yield = 3.37

Div Yld 5 Yr Avg 12/2011 = 3.63

Div Yld 5 Yr Avg 09/2011 = 3.6

Annual Dividend 12/2011 = 3.3

Annual Dividend 12/2010 = 2.35

Forward Yield = 3.37

Div 5yr Growth 12/2011 = 6.86

R-squared Div Growth 12/2011 = 0.6

R-squared Div Growth 09/2011 = 0.62

Dividend sustainability

Payout Ratio 09/2011 = 0.42

Payout Ratio 06/2011 = N/A

Payout Ratio 5 Yr Avg 12/2011 = 0.43

Payout Ratio 5 Yr Avg 09/2011 = 0.44

Payout Ratio 5 Yr Avg 06/2011 = N/A

Change in Payout Ratio = -0.06

Performance

% Ch Price 52 Wks Rel to S&P 500 = -6.18

Std Dev Target Price Est = 8.04

Avg EPS Surprise Last 4 Qtr = 10.58

EPS % Change F2/F1 = 8.52

Next 3-5 Yr Est EPS Gr rate = 12

Std Dev 3-5 Yr Est EPS Gr rate = N/A

EPS Gr Q(1)/Q(-3) = 103.35

5 Yr Hist EPS Gr 12/2011 = 7.91

5 Yr Hist EPS Gr 09/2011 = N/A

ROE 5 Yr Avg 12/2011 = 15.32

ROE 5 Yr Avg 09/2011 = 15.43

ROE 5 Yr Avg 06/2011 = N/A

Return on Investment 12/2011 = 10.91

Return on Investment 09/2011 = 10.57

Return on Investment 06/2011 = N/A

Debt/Tot Cap 5 Yr Avg 12/2011 = 27.01

Debt/Tot Cap 5 Yr Avg 09/2011 = 27.55

Debt/Tot Cap 5 Yr Avg 06/2011 = N/A

Current Ratio 12/2011 = 0.85

Current Ratio 09/2011 = 0.62

Current Ratio 06/2011 = N/A

Curr Ratio 5 Yr Avg = 0.85

Quick Ratio = 0.85

Cash Ratio = 0.29

Interest Coverage 12/2011 = 6.74

Interest Coverage 09/2011 = 6.12

Interest Coverage 06/2011 = N/A

Valuation

Book Value Qtr ($/sh) 12/2011 = 51.28

Book Value Qtr ($/sh) 09/2011 = 46.54

Book Value Qtr ($/sh) 06/2011 = N/A

Anl EPS before NRI 12/2007 = 5.17

Anl EPS before NRI 12/2008 = 4.71

Anl EPS before NRI 12/2009 = 5.16

Anl EPS before NRI 12/2010 = 5.65

Anl EPS before NRI 12/2011 = 6.69

Price/ Book = 1.58

Price/ Cash Flow = 9.8

Price/ Sales = 2.65

EV/EBITDA 12 Mo = -6.16

P/E/G F1 = 0.95

Q1 Std Dev/ Consensus = 0.03

R-squared EPS Growth 12/2011 = 0.58

R-squared EPS Growth 09/2011 = N/A

P/E F1/ LT EPS Gr = 0.95

Std Dev Cons Current Qtr = 0.05

Median Est Next Qtr = 1.79

# Anlst in Cons Q3 = 4

Company: Bank Of Nova Scotia (NYSE:BNS)

Levered Free Cash Flow = N/A

Basic Key ratios

Percentage Held by Insiders = N/A

Market Cap ($mil) = 58641

Number of Institutional Sellers 12 Weeks = N/A

3 Month % Chg Short Interest = n/a

Growth

Net Income ($mil) 12/2011 = 5342

Net Income ($mil) 12/2010 = 4239

Net Income ($mil) 12/2009 = 3547

12mo Net Incm this Q/ 12mo Net Incm 4Q's ago = 26.9

Q Net Incm this Q/ same qtr yr ago = 11.4

EBITDA ($mil) 12/2011 = 9059

EBITDA ($mil) 12/2010 = 7920

EBITDA ($mil) 12/2009 = 7392

Net Incm Rpt Qtr ($mil) = 1201

Anl Net Incm this Yr/ Net Incm last Yr = 26.03

Cash Flow ($/sh) 12/2011 = 5.06

Cash Flow ($/sh) 12/2010 = 4.41

Cash Flow ($/sh) 12/2009 = 4.15

Div 5yr Growth 12/2011 = 5.71

Sales ($mil) 12/2011 = 26537

Sales ($mil) 12/2010 = 23478

Sales ($mil) 12/2009 = 23736

Dividend history

Div Yield = 3.87

Div Yld 5 Yr Avg 12/2011 = 4.05

Div Yld 5 Yr Avg 09/2011 = 4.01

Annual Dividend 12/2011 = 2.06

Annual Dividend 12/2010 = 1.89

Forward Yield = 3.87

Div 5yr Growth 12/2011 = 5.71

R-squared Div Growth 12/2011 = 0.54

R-squared Div Growth 09/2011 = 0.59

Dividend sustainability

Payout Ratio 09/2011 = 0.5

Payout Ratio 06/2011 = N/A

Payout Ratio 5 Yr Avg 12/2011 = 0.5

Payout Ratio 5 Yr Avg 09/2011 = 0.5

Payout Ratio 5 Yr Avg 06/2011 = N/A

Change in Payout Ratio = -0.05

Performance

% Ch Price 52 Wks Rel to S&P 500 = -15.59

Std Dev Target Price Est = 3.65

Avg EPS Surprise Last 4 Qtr = 0.05

EPS % Change F2/F1 = 9.74

Next 3-5 Yr Est EPS Gr rate = 12

Std Dev 3-5 Yr Est EPS Gr rate = N/A

EPS Gr Q(1)/Q(-3) = 101.82

5 Yr Hist EPS Gr 12/2011 = 3.59

5 Yr Hist EPS Gr 09/2011 = N/A

ROE 5 Yr Avg 12/2011 = 19.64

ROE 5 Yr Avg 09/2011 = 19.65

ROE 5 Yr Avg 06/2011 = N/A

Return on Investment 12/2011 = 13.22

Return on Investment 09/2011 = 13.36

Return on Investment 06/2011 = N/A

Debt/Tot Cap 5 Yr Avg 12/2011 = 17.51

Debt/Tot Cap 5 Yr Avg 09/2011 = 17.43

Debt/Tot Cap 5 Yr Avg 06/2011 = N/A

Current Ratio 12/2011 = 0.99

Current Ratio 09/2011 = 0.99

Current Ratio 06/2011 = N/A

Curr Ratio 5 Yr Avg = 1

Quick Ratio = 0.99

Cash Ratio = 0.34

Interest Coverage 12/2011 = 4.68

Interest Coverage 09/2011 = 4.55

Interest Coverage 06/2011 = N/A

Valuation

Book Value Qtr ($/sh) 12/2011 = 27.09

Book Value Qtr ($/sh) 09/2011 = 25.84

Book Value Qtr ($/sh) 06/2011 = N/A

Anl EPS before NRI 12/2007 = 3.66

Anl EPS before NRI 12/2008 = 3.6

Anl EPS before NRI 12/2009 = 3.56

Anl EPS before NRI 12/2010 = 3.86

Anl EPS before NRI 12/2011 = 4.54

Price/ Book = 1.99

Price/ Cash Flow = 10.63

Price/ Sales = 2.16

EV/EBITDA 12 Mo = -9.43

P/E/G F1 = 0.95

Q1 Std Dev/ Consensus = 0.03

R-squared EPS Growth 12/2011 = 0.27

R-squared EPS Growth 09/2011 = N/A

P/E F1/ LT EPS Gr = 0.95

Std Dev Cons Current Qtr = 0.04

Median Est Next Qtr = 1.19

# Anlst in Cons Q3 = 3

Company: New Jersey Resources (NYSE:NJR)

Levered Free Cash Flow = 9.91M

Basic Key ratios

Percentage Held by Insiders = 0.73

Market Cap ($mil) = 1943

Number of Institutional Sellers 12 Weeks = 1

3 Month % Chg Short Interest = n/a

Growth

Net Income ($mil) 12/2011 = 101

Net Income ($mil) 12/2010 = 117

Net Income ($mil) 12/2009 = 27

12mo Net Incm this Q/ 12mo Net Incm 4Q's ago = 48.95

Q Net Incm this Q/ same qtr yr ago = 134.02

EBITDA ($mil) 12/2011 = 182

EBITDA ($mil) 12/2010 = 227

EBITDA ($mil) 12/2009 = 84

Net Incm Rpt Qtr ($mil) = 57

Anl Net Incm this Yr/ Net Incm last Yr = -13.76

Cash Flow ($/sh) 12/2011 = 3.42

Cash Flow ($/sh) 12/2010 = 3.28

Cash Flow ($/sh) 12/2009 = 3.14

Div 5yr Growth 12/2011 = 9.26

Sales ($mil) 12/2011 = 3009

Sales ($mil) 12/2010 = 2639

Sales ($mil) 12/2009 = 2592

Dividend history

Div Yield = 3.24

Div Yld 5 Yr Avg 12/2011 = 3.33

Div Yld 5 Yr Avg 09/2011 = 3.32

Annual Dividend 12/2011 = 1.44

Annual Dividend 12/2010 = 1.36

Forward Yield = 3.24

Div 5yr Growth 12/2011 = 9.26

R-squared Div Growth 12/2011 = 0.96

R-squared Div Growth 09/2011 = 0.96

Dividend sustainability

Payout Ratio 09/2011 = 0.56

Payout Ratio 06/2011 = 0.57

Payout Ratio 5 Yr Avg 12/2011 = 0.54

Payout Ratio 5 Yr Avg 09/2011 = 0.55

Payout Ratio 5 Yr Avg 06/2011 = 0.55

Change in Payout Ratio = -0.03

Performance

% Ch Price 52 Wks Rel to S&P 500 = 7.02

Std Dev Target Price Est = 5.27

Avg EPS Surprise Last 4 Qtr = -0.29

EPS % Change F2/F1 = 3.7

Next 3-5 Yr Est EPS Gr rate = 4.5

Std Dev 3-5 Yr Est EPS Gr rate = 0.71

EPS Gr Q(1)/Q(-3) = -155.71

5 Yr Hist EPS Gr 12/2011 = 4.62

5 Yr Hist EPS Gr 09/2011 = 4.74

ROE 5 Yr Avg 12/2011 = 13.71

ROE 5 Yr Avg 09/2011 = 13.53

ROE 5 Yr Avg 06/2011 = 13.5

Return on Investment 12/2011 = 10.03

Return on Investment 09/2011 = 8.86

Return on Investment 06/2011 = 8.78

Debt/Tot Cap 5 Yr Avg 12/2011 = 36.86

Debt/Tot Cap 5 Yr Avg 09/2011 = 36.85

Debt/Tot Cap 5 Yr Avg 06/2011 = 36.82

Current Ratio 12/2011 = 1.04

Current Ratio 09/2011 = 1.04

Current Ratio 06/2011 = 1.18

Curr Ratio 5 Yr Avg = 1.15

Quick Ratio = 0.61

Cash Ratio = 0.32

Interest Coverage 12/2011 = 15.15

Interest Coverage 09/2011 = N/A

Interest Coverage 06/2011 = 5.98

Valuation

Book Value Qtr ($/sh) 12/2011 = 19.81

Book Value Qtr ($/sh) 09/2011 = 18.73

Book Value Qtr ($/sh) 06/2011 = 19.25

Anl EPS before NRI 12/2007 = 1.55

Anl EPS before NRI 12/2008 = 2.22

Anl EPS before NRI 12/2009 = 2.38

Anl EPS before NRI 12/2010 = 2.44

Anl EPS before NRI 12/2011 = 2.56

Price/ Book = 2.37

Price/ Cash Flow = 13.71

Price/ Sales = 0.66

EV/EBITDA 12 Mo = 13.01

P/E/G F1 = 3.79

Q1 Std Dev/ Consensus = 0.04

R-squared EPS Growth 12/2011 = 0.51

R-squared EPS Growth 09/2011 = 0.51

P/E F1/ LT EPS Gr = 3.79

Std Dev Cons Current Qtr = 0.06

Median Est Next Qtr = 0.23

# Anlst in Cons Q3 = 5

Company: Atmos Energy Corp (NYSE:ATO)

Levered Free Cash Flow = -312.02M

Basic Key ratios

Percentage Held by Insiders = 1.53

Market Cap ($mil) = 2791

Number of Institutional Sellers 12 Weeks = N/A

3 Month % Chg Short Interest = n/a

Growth

Net Income ($mil) 12/2011 = 208

Net Income ($mil) 12/2010 = 206

Net Income ($mil) 12/2009 = 191

12mo Net Incm this Q/ 12mo Net Incm 4Q's ago = 8.37

Q Net Incm this Q/ same qtr yr ago = -7.42

EBITDA ($mil) 12/2011 = 697

EBITDA ($mil) 12/2010 = 694

EBITDA ($mil) 12/2009 = 650

Net Incm Rpt Qtr ($mil) = 69

Anl Net Incm this Yr/ Net Incm last Yr = 0.86

Cash Flow ($/sh) 12/2011 = 4.75

Cash Flow ($/sh) 12/2010 = 4.72

Cash Flow ($/sh) 12/2009 = 4.46

Div 5yr Growth 12/2011 = 1.53

Sales ($mil) 12/2011 = 4348

Sales ($mil) 12/2010 = 4720

Sales ($mil) 12/2009 = 4869

Dividend history

Div Yield = 4.47

Div Yld 5 Yr Avg 12/2011 = 4.64

Div Yld 5 Yr Avg 09/2011 = 4.64

Annual Dividend 12/2011 = 1.36

Annual Dividend 12/2010 = 1.34

Forward Yield = 4.47

Div 5yr Growth 12/2011 = 1.53

R-squared Div Growth 12/2011 = 0.97

R-squared Div Growth 09/2011 = 0.96

Dividend sustainability

Payout Ratio 09/2011 = 0.6

Payout Ratio 06/2011 = 0.62

Payout Ratio 5 Yr Avg 12/2011 = 0.63

Payout Ratio 5 Yr Avg 09/2011 = 0.63

Payout Ratio 5 Yr Avg 06/2011 = 0.63

Change in Payout Ratio = 0.04

Performance

% Ch Price 52 Wks Rel to S&P 500 = -13.15

Std Dev Target Price Est = 2.06

Avg EPS Surprise Last 4 Qtr = -5.02

EPS % Change F2/F1 = 7.3

Next 3-5 Yr Est EPS Gr rate = 4.67

Std Dev 3-5 Yr Est EPS Gr rate = 1.16

EPS Gr Q(1)/Q(-3) = 124.69

5 Yr Hist EPS Gr 12/2011 = 1.35

5 Yr Hist EPS Gr 09/2011 = 0.8

ROE 5 Yr Avg 12/2011 = 8.92

ROE 5 Yr Avg 09/2011 = 9.07

ROE 5 Yr Avg 06/2011 = 9.18

Return on Investment 12/2011 = 4.23

Return on Investment 09/2011 = 4.75

Return on Investment 06/2011 = 4.75

Debt/Tot Cap 5 Yr Avg 12/2011 = 48.48

Debt/Tot Cap 5 Yr Avg 09/2011 = 48.49

Debt/Tot Cap 5 Yr Avg 06/2011 = 48.86

Current Ratio 12/2011 = 1.07

Current Ratio 09/2011 = 1.17

Current Ratio 06/2011 = 1.53

Curr Ratio 5 Yr Avg = 1.09

Quick Ratio = 0.83

Cash Ratio = 0.52

Interest Coverage 12/2011 = 4.02

Interest Coverage 09/2011 = 0.72

Interest Coverage 06/2011 = 0.91

Valuation

Book Value Qtr ($/sh) 12/2011 = 25.1

Book Value Qtr ($/sh) 09/2011 = 24.98

Book Value Qtr ($/sh) 06/2011 = 25.86

Anl EPS before NRI 12/2007 = 1.97

Anl EPS before NRI 12/2008 = 2

Anl EPS before NRI 12/2009 = 2.12

Anl EPS before NRI 12/2010 = 2.23

Anl EPS before NRI 12/2011 = 2.13

Price/ Book = 1.23

Price/ Cash Flow = 6.51

Price/ Sales = 0.65

EV/EBITDA 12 Mo = 7.05

P/E/G F1 = 2.84

Q1 Std Dev/ Consensus = 0.03

R-squared EPS Growth 12/2011 = 0.06

R-squared EPS Growth 09/2011 = 0.02

P/E F1/ LT EPS Gr = 2.84

Std Dev Cons Current Qtr = 0.05

Median Est Next Qtr = 0.15

# Anlst in Cons Q3 = 5

Conclusion

The markets are extremely overbought; long term investors should wait for a strong pullback before committing fresh money to this market.

Sources: Free cash flow yield, income from cont operations and revenue growth charts sourced from Ycharts. EPS, EPS surprise, broker recommendations and price and consensus charts sourced from zacks.com. Earnings Vs expectations sourced from smartmoney.com. Earnings estimates and growth rate charts for LO sourced from dailyfinance.com. Dividend history charts sourced from dividata.com. Financial result's summary for LO obtained from lorillard.com.

Disclaimer: This list of stocks is meant to serve as a starting point. Please do not treat this as a buying list. It is imperative that you do your due diligence and then determine if any of the above plays meet with your risk tolerance levels. The Latin maxim caveat emptor applies-let the buyer beware.

Source: Lorillard: A Good Long-Term Dividend Play