Altria Group, Inc.NYSE
Holy Smoke - My Favorite Idea That Everyone Knows But Doesn't Understand
Jenks Jumps • 292 Comments
Jenks Jumps • 292 Comments
Fri, Oct. 21, 10:38 AM
- A proposed bid from British American Tobacco bid for Reynolds American has the tobacco sector on the move. A combination of the two would create the largest tobacco company in the world.
- It was only two years ago that Reynolds and Lorillard merged in a dramatic development.
- Gainers today include Altria Group (MO +3.7%), Vector Group (VGR +2.3%), and Turning Point Brands (TPB +1.6%), Imperial Brands (OTCQX:IMBBY +1.7%), and Philip Morris International (PM +1.7%),
- Previously: BAT bids $47B to take Reynolds American ownership to 100% (Oct. 21)
- Previously: Reynolds American confirms British Tobacco offer, shares +20% (Oct. 21)
Wed, Oct. 19, 2:16 PM
- Reynolds American (NYSE:RAI) is down 2.84% after missing Q3 estimates.
- During the company's earnings call, management lowered guidance for 2016 industry cigarette volume to -2.5%, from -2.0% prior. They also updated on the new $2.0B repurchase program, saying $75M of the allowance was tapped during the quarter.
- Notable decliners off the weak sector read include Altria Group (MO -1.3%), Philip Morris (PM -0.6%), and Japan Tobacco (OTCPK:JAPAY -0.9%).
- Reynolds earnings call transcript
- Previously: Reynolds American names Crew as new CEO; Cameron to become chairman (Oct. 19)
Tue, Oct. 11, 10:56 AM
- Altria Group (MO) discloses it holds a voting stake of 9.6% in Anheuser-Busch InBev following the completion of the SABMiller merger.
- Altria's CEO Marty Barrington and CFO Billy Giffords are both on the AB InBev board.
- The company brought in $5.3B in pre-tax cash from the deal, which includes some proceeds from derivatives used to hedge British pound exposure.
- The share repurchase program at Altria is upped to $3B from $1B. The buybacks are expected to be finished before the end of Q2 in 2018.
- Altria full update (.pdf)
Tue, Sep. 20, 4:28 PM
- Shareholders holding sizable positions in SABMiller (OTCPK:SBMRY) are in the spotlight as the company's meeting on September 26 approaches. The vote on the Anheuser-Busch InBev (NYSE:BUD) merger will be the main event of the SABMiller gathering.
- Large institutional shareholders such as BlackRock and State Street Global Advisers are seen approving the deal because they also own interests in BUD and Molson Coors, but the hedge fund vote is harder to forecast. Some hedgies may gamble and skip out on voting by declining to convert their options and derivatives to save on the exercise tax.
- Another reason that the merger vote may be closer than anticipated is that both Altria (NYSE:MO) and the Santo Domingo family are excluded from having a say.
Tue, Sep. 20, 9:24 AM
- Altria Group (NYSE:MO) reaffirms 2016 EPS guidance of $3.01 to $3.07. The consensus estimate from analysts is at $3.05. Altria's guidance doesn't include new charges related to the early retirement of debt.
- Altria expects that its full-year effective tax rate will increase 10 bps to 35.4%.
- The company's guidance update doesn't factor in the Anheuser-Busch InBev-SABMiller combination since the deal hasn't closed yet.
- Source: Press Release
Fri, Sep. 16, 3:23 AM
- A month after assuming regulatory oversight over e-cigarettes, the FDA has cracked down on online sales by the industry, issuing 24 letters to websites for illegal sales to minors.
- The agency hasn't moved to ban online purchases, as many in the industry expected, but the letters show it's closely monitoring those outlets.
- Websites and stores will have 15 days to reply and explain how they plan to prevent future underage sales.
- Related tickers: MO, BTI, LO, PM, OTCQB:ECIG, OTCQB:VAPE, OTCPK:HPNN, OTCQB:MCIG, OTCQB:NTRR, OTCPK:VAPR, VPCO, RAI, OTC:AHII
Tue, Sep. 13, 7:39 AM
- There's another bullish call from Wall Street on the tobacco sector this morning as Citi initiates coverage on both Reynolds American (NYSE:RAI) and Altria (NYSE:MO) with Buy ratings.
- Analyst Adam Spielman expects "robust" cigarette demand in the U.S. and points to the potential for dividend increases.
- Philip Morris International(NYSE:PM) is rated at Neutral by Citi. Shares of Philip Morris have outperformed the other two tobacco stocks on a YTD basis (+15% vs. +11% for MO and +4% for RAI).
- Previously: Philip Morris moves higher after Goldman Sachs turns positive (Sept. 12)
Fri, Sep. 9, 8:09 AM
- Big Tobacco is pouring money into California in an effort to defeat a proposal to increase the state tax on cigarettes to $2.87 per pack.
- Opponents of the tax increase have raised over $35M to double the $17M generated by supporters of the tax.
- Analysts believe the vote in California is crucial with other states likely to watch the outcome very closely and some global implications in play as well.
- Proposition 56 language: "Increases cigarette tax by $2.00 per pack, with equivalent increase on other tobacco products and electronic cigarettes containing nicotine."
- Related tobacco industry stocks: PM, MO, VGR, RAI, OTCQX:ITYBF, BTI, OTCQB:ECIG, OTCQB:VAPE, OTCPK:HPNN, OTCQB:MCIG, OTCQB:NTRR, OTCPK:VAPR, OTC:AHII.
Tue, Sep. 6, 12:03 PM
- Efforts in Europe to convince money managers to skip tobacco stocks have fallen flat, according to Reuters. Only French insurance giant Axa sold off its position in tobacco companies on moral grounds.
- "We are firmly of the view that profits, cash and dividends from tobacco stocks have many years of strong growth ahead," says Woodford Investment Management's Stephen Lamacraft. The fund manager's view seems to be the majority opinion based off of recent investment returns in the sector.
- Related stocks: Phillip Morris International (NYSE:PM), Altria (NYSE:MO), Reynolds American (NYSE:RAI), British American Tobacco (NYSEMKT:BTI), Japan Tobacco (OTCPK:JAPAF, OTCPK:JAPAY), Imperial Brands (OTCQX:IMBBY, OTCQX:ITYBF).
Thu, Aug. 25, 3:07 PM
Tue, Aug. 23, 7:08 AM
- A court in the U.K. rules that Altria (NYSE:MO) and Bevco can be treated as a separate class from other SABMiller (OTCPK:SBMRY) shareholders in connection with a vote on the company's merger with Anheuser-Busch InBev (NYSE:BUD).
- Both classes will need to approve the terms of the merger by a 75% rate.
Fri, Jul. 29, 11:30 AM
- The board at SABMiller (OTCPK:SBMRY) officially throws its support behind the acquisition of the company by Anheuser-Busch InBev (BUD +2.4%). The £79B ($104.94B) offer was at the "lower end" of the company's acceptable range.
- A-B landed its last required regulatory approval earlier today in China after raising its offer for SABMiller at the beginning of the week.
- The deal brings together a large number of beer brands into the same corporate house even after key divestitures across regions. A partial list of the Megabrew assets includes Bud Light, Budweiser, Michelob, Rolling Rock, Busch, Shock Top, Natural, Goose Island, Blue Point, Four Peaks, Grolsch, Pilsner Urquell, Foster's Lager, and Castle Lager.
- Shares of MolsonCoors (NYSE:TAP) are up 3.32% with the company now set to control MillerCoors in the U.S. by itself. SABMiller stakeholder Altria (MO +1%) also perked up after the announcement.
Wed, Jul. 27, 7:38 AM
- Altria (NYSE:MO) reports a 5% drop in volume for smokeable products in Q2. Volume for the Marlboro brand was down 5.5%.
- Retail cigarette market share held steady at 51.4%. Cigar market share fell 110 bps to 26.7%.
- Adjusted OCI margin for smokeable products rose 260 bps to 50.1%.
- Revenue for smokeless products was up 9% to $523M on a 4% gain in volume. Retail market share for the category improved 110 bps to 55.8%.
- Altria increases full-year EPS guidance to $3.01-$3.07 vs. $3.05 consensus. The company expects a full-year effective tax rate of 35.3%.
- Previously: Altria beats by $0.01, misses on revenue (July 27)
- MO +0.68% premarket to $68.39.
Wed, Jul. 27, 7:03 AM
Tue, Jul. 26, 5:30 PM
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Tue, Jul. 26, 11:34 AM
- Bloomberg Gadfly outlines the case on why the board at SABMiller (OTCPK:SBMRY) should reject the upped offer from Anheuser-Busch InBev (BUD +1%).
- Though the new deal valued at $104B offers larger shareholders such as Altria (MO -0.8%), Bevco, and hedge funds improved partial share alternative benefits, the premium is still on the thin side for smaller investors due to the pound devaluation.
- Also, the risks of combining two companies with dramatically opposing cultures can't be ignored, warns Bloomberg.
- SABMiller's board is expected to review the offer after regulators in China weigh in on the merger.
- Previously: AB InBev sweetens offer for SABMiller (July 26)