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Reynolds American Inc. (RAI) is scheduled to report its Q2 2012 results on July 24, 2012, before market opens. The street expects EPS and revenue of $0.77 and $2.25B, respectively.

In this article I will recap the historical results of the company, its latest EPS estimates vs. surprises, the latest news from RAI and the news from its closest competitors.

Reynolds American Inc. Revenue and Net Income History

Recent EPS Actuals vs. Estimates

In the last quarter RAI reported $0.63 EPS, failing to meet analyst estimates of $0.65.

Reynolds American Inc. EPS Historical Results vs Estimates

The consensus EPS estimate is $0.77 based on 13 analysts' estimates, up from $0.71 a year ago. Revenue estimates are $2.25B, just below from $2.27B a year ago. The median target price by analysts for the stock is $43.50.

Average recommendation: Hold

Source: Marketwatch

Latest News

  • On April 24, 2012, Reynolds American, Inc. reaffirmed its fiscal 2012 guidance for adjusted earnings per share (EPS) to be in the range of $2.91 to $3.01, excluding the restructuring charge.
  • On February 8, 2012, Reynolds American, Inc. announced that it expects adjusted EPS growth in mid- to high-single digits for fiscal 2012.

Competitors

British American Tobacco (BTI), Lorillard (LO), Altria Group (MO), and Philip Morris International (PM) are considered major competitors for Reynolds American and the table below provides the key metrics for these companies and the industry.

Reynolds American Inc. key ratio comparison with direct competitors

The chart below compares the stock price changes as a percentage for the selected companies and S&P 500 index for the last one year period.

(click to enlarge)RAI Chart

RAI data by YCharts

Competitors' Latest Development

  • On July 19, 2012, Philip Morris International Inc. reaffirmed fiscal 2012 guidance and expects diluted earnings per share forecast to be in a range of $5.10 to $5.20, compared to $4.85 in 2011.
  • On June 13, 2012, Philip Morris International Inc. announced a new three-year share repurchase program of $18 billion. It is anticipated that the new program will be initiated August 1, 2012, following completion of the existing three-year program of $12 billion which began in May 2010 and which will conclude ahead of schedule.
  • On May 7, 2012, Philip Morris International Inc. announced that Hermann Waldemer, Chief Financial Officer, has elected to take early retirement effective July 31, 2012.
  • On April 25, 2012, Lorillard Inc. announced that it has acquired all of the assets of blu ecigs, a U.S. electronic cigarette (e-cigarette) company for $135 million in cash. blu ecigs is the e-cigarette brand. blu ecigs will be a separate operating company of Lorillard and it is Lorillard's intention to retain blu ecigs' current management team and headquarters in Charlotte, NC.
  • On April 19, 2012, Philip Morris International Inc. revised, for prevailing exchange rates only, fiscal 2012 reported diluted EPS forecast to be in a range of $5.20 to $5.30. Excluding a forecasted total unfavorable currency impact of approximately $0.15 for fiscal 2012, reported diluted earnings per share are projected to increase by approximately 10% to 12% versus adjusted diluted earnings per share of $4.88 in 2011, unchanged from the earnings per share forecast provided on February 23, 2012.
  • On March 1, 2012, Altria Group Inc announced that its Board of Directors declared a regular quarterly dividend of $0.41 per common share, payable on April 10, 2012, to shareholders of record as of March 15, 2012.
  • On February 22, 2012, Altria Group Inc reaffirmed fiscal 2012 guidance for reported diluted earnings per share in the range of $2.14 to $2.20. The forecast includes estimated charges of $0.03 per share related to asset impairment, exit and implementation costs primarily related to the cost reduction program announced in October 2011, and estimated charges related to SABMiller special items.
  • On February 9, 2012, Lorillard Inc. announced that its Board of Directors approved a 19% increase in the quarterly dividend on its common stock from $1.30 per share to $1.55 per share.
  • On February 9, 2012, Philip Morris International Inc. announced that it expects to report full year 2012 diluted earnings per share to be in a range of USD 5.25 to USD 5.35, at prevailing exchange rates, versus USD 4.85 in full year 2011.
  • On January 27, 2012, Altria Group Inc announced that Chairman and Chief Executive Officer (CEO), Michael E. Szymanczyk, 63, has decided to retire; Altria's Board of Directors (Board) elects Martin J. Barrington, 58, to serve as Altria's Chairman and Chief Executive Officer , and David R. Beran, 57, to serve as Altria's President and Chief Operating Officer (COO), effective May 17, 2012; Mr. Barrington joins Altria's Board effective immediately.
  • On January 27, 2012, Altria Group Inc announced that for fiscal 2012, it expects diluted earnings per share to be in the range of $2.14-$2.20. The forecast includes estimated charges of $0.03 per share related to asset impairment, exit, integration and implementation costs primarily related to the cost reduction program announced in October 2011, and estimated charges related to SABMiller special items and expects adjusted diluted EPS which excludes special items will be in the range of $2.17-$2.23. According to I/B/E/S estimates, analysts were expecting the Company to report EPS of $2.19 for fiscal 2012.

Technical Overview


The stock has a market capitalization of $26.43B and is currently trading at $46.24 with a 52 week range of $31.82 - $46.61. The stock's year-to-date performance has been 14.77%. It is currently trading above 20, 50 and 200 SMA.

Sources: Yahoo Finance, Google Finance, Marketwatch, Finviz, Reuters.

Source: Earnings Preview: Reynolds American