Reynolds' Cigarettes Are Good For You(r Portfolio)
Chris DeMuth Jr. • 33 Comments
Chris DeMuth Jr. • 33 Comments
Fri, Jun. 24, 1:22 PM
- U.S. tobacco stocks are higher, bucking today's broad downturn, as investors view the group as a relatively safe haven in a risk-off environment.
- Shares of Altria (MO +2.2%), the no. 1 U.S. cigarette maker, hit a 52-week high of $67.98 earlier and continue to sport solid gains, and Reynolds American (RAI +1.8%) remains strong after touching a more than three-month high of $51.84.
- "With Brexit potentially delaying a rate hike in the U.S., this move likely favors our higher-yielding names, and in particular U.S. tobacco (RAI and MO)," according to analysts at Cowen.
- However, Philip Morris International (PM -3%), which generated more than a third of its revenue from the European Union last year, is sharply lower.
Mon, Mar. 7, 9:29 AM
- CNBC reports there are "no talks" between British American Tobacco (NYSEMKT:BTI) and Reynolds American (NYSE:RAI).
- Shares of RAI are now flat in premarket trading after being up 2.4% earlier amid buzz in London over a potential deal.
- Previously: Reynolds American on watch with report of BAT interest (Mar. 07 2016)
Mon, Jan. 25, 12:00 PM
- Tobacco stocks and soft drinks names are mild outperformers on the day.
- Despite soft consumer spending trends, some retail analysts think 2016 sales for beer, cigarettes, and soft drinks will pick up in the U.S. as gas prices remain at low levels.
- Gainers today on a down market day include Dr. Pepper Snapple (DPS +1%), PepsiCo (PEP +0.7%), Coca-Cola (KO +0.7%), Coca-Cola Bottling Company (COKE +2.6%), Coca-Cola Enterprises (CCE +1.1%), Reynolds American (RAI +1.7%), Altrai (MO +1%), Philip Morris (PM +0.5%), and Anheuser-Busch InBev (BUD +0.7%).
- Speculation that anti-soda and cigarette advocate Michael Bloomberg might run for president doesn't appear to be creating even a ripple of worry.
- Previously: Michael Bloomberg is seriously considering running for president (Jan. 23 2016)
Wed, Jan. 13, 4:31 PM
- Reynolds American (RAI -1.8%) says after getting regulatory approval, it's wrapped up a sale of international rights to its Natural American Spirit brand.
- The deal gives rights to the name and associated trademarks to Japan Tobacco Group for about $5B, all in cash. The deal includes the companies distributing and marketing the brand outside the U.S.
- At last report, Reynolds American had $3.18B in cash against total debt of $17.93B.
- Shares are up 0.2% after hours.
Oct. 27, 2015, 7:12 AM
- Reynolds American (NYSE:RAI) reported a 65% jump in non-GAAP operating income to $1.41B in Q3.
- Total domestic cigarette volumes were up 29.5% during the quarter as the addition of the Newport brand factored in. Retail market share +30 bps to 33.9%.
- Reynolds' operating margin improved 640 bps to 44.4%.
- The company ended the quarter with $2.9B in cash.
- Previously: Reynolds American EPS in-line, beats on revenue (Oct. 27 2015)
- RAI +0.65% premarket to $49.84.
Jun. 16, 2015, 9:08 AM
- Goldman Sachs calls Reynolds American (NYSE:RAI) the "best in class" in the tobacco sector following the company's merger with Lorillard.
- Reynolds American lands on the Conviction Buy List at Goldman due to its upside potential after clearing the regulatory hurdles associated with the Lorillard integration.
- Despite being forced to shed some brands, Reynolds is seen having better pricing power due to its larger market share.
- GS assigns Reynolds a price target of $81 based off a blended assumption of 17.5X 12-24 month P/E and M&A EBITDA gains.
- RAI +1.0% premarket t0 $73.29.
Apr. 17, 2015, 7:30 AM
- Reynolds American (NYSE:RAI) reports cigarette volume fell 2.4% to 13.9B in Q1 vs. +0.5% industry average.
- Cigarette market share -50 bps to 26.1%.
- Premium mix +30 bps to 58.7%.
- SG&A expenses +23.73% Y/Y to $511M.
- Operating margin rate increased 280 bps to 37.2%.
- FY2015 Guidance: Adjusted EPS: $3.65 to $3.80.
- RAI +1.70% premarket.
Apr. 10, 2015, 10:22 AM
- Lorillard (LO +2%) and Reynolds American (RAI +2.4%) break higher on renewed chatter the FTC will decide against a lawsuit to halt the merger between the companies.
- Earlier today, Reynolds American announced it will host its earnings conference call on April 17 at which time more details on the merger and synergy estimates could be disclosed.
- Lorilalrd trades at an all-time high, while Reynolds American is only a dollar and change from a 52-week top.
Aug. 6, 2014, 10:00 AM
- Tobacco stocks are higher today in what analysts are calling a defensive move by investors.
- There's also been some stronger pricing trends on the lower-end of the cigarette market that has helped to boost the outlook on the group.
- Gainers: Philip Morris (PM +2.2%), Reynolds American (RAI +1.6%), Vector Group (VGR +1.4%), and Altrai (MO +1.9%).
Jul. 15, 2014, 10:53 AM
- Tobacco stocks slump as a group after Lorillard doesn't catch the premium in the Reynolds American buyout that some anticipated.
- Even Imperial Tobacco which ended up with the hot Blu e-cigarette brand as part of the deal is having trouble shaking off the pessimism.
- Decliners: Lorillard (NYSE:LO) -7.9%, Philip Morris (NYSE:PM) -1.3%, Altria (NYSE:MO) -2.1%, Vector Group (NYSE:VGR) -0.8%, Reynolds American (NYSE:RAI) -4.0%, Imperial Tobacco (OTCMKTS:ITYBY) -2.8%, British American Tobacco (NYSEMKT:BTI) -1.4%.
Jul. 11, 2014, 7:18 AM
- Shares of Lorillard (LO) are higher in early trading after Reynolds American (RAI) confirms an earlier report that it's in talks with the company over a buyout.
- Reynolds says British American Tobacco will support the transaction by subscribing additional shares.
- Imperial Tobacco (ITYBY) will snap up key brands to help make the deal more likely to sail past regulators.
- LO +4.6% premarket
Jul. 9, 2014, 8:16 AM| Jul. 9, 2014, 8:16 AM | 3 Comments
Jul. 3, 2014, 10:18 AM
- Shares of Lorillard (LO +4.6%) are higher after CNBC reports its sources indicate a merger of the company with Reynold American (RAI +1.6%) will be announced within weeks.
- In the deal sidecar: Imperial Tobacco (ITYBY) is expected to buy some assets in order to make the deal palatable for regulators, while British American Tobacco (BTI) is tapped to be part of the festivities as an investor in Reynolds.
Jun. 18, 2014, 9:02 AM
- Wells Fargo analyst Bonnie Herzog is fairly confident (90%) that a deal in which Reynolds American (RAI) pays up to $80 per share for Lorillard (LO) is still likely (CNBC interview video).
- Herzog thinks a combination of the two companies will "catapult" the e-cigarette business.
- LO +2.0% premarket to $63.01 giving investors plenty of upside still if the Wells call is correct.
Jun. 11, 2014, 8:17 AM
- Reynolds American (RAI) is upgraded by Bank of America to a Buy rating from Neutral.
- The investment firm gives shares a premium due to a potential merger of Reynolds with Lorillard.
- Favorable industry pricing trends in Q2 also set up well for Reynolds.
- RAI +0.2% premarket
May 22, 2014, 10:36 AM
- Shares of Lorillard (LO -5.5%) retreat after reality sets in that a deal for the company to be purchased by Reynolds American (RAI -1.8%) is complicated and could take some time to work out. The third wheel in the merger mix is British American Tobacco (BTI -0.9%) which owns 42% of Reynolds and could make a play for the whole company after a standstill agreement expires in July.
- Analysis is divided on if a deal will end up being completed at all. Stifel thinks regulators will jump in over the dominance in menthol a combination of the tobacco companies would create - while Wells Fargo's read is much more optimistic.
- Vector Group (VGR -1.6%) has been taken for a ride along with Lorillard and Reynolds, popping yesterday and deflating today.
Reynolds American Inc. is a holding company, which manufactures and sells cigarettes in United States. The company operating segments include RJR Tobacco, American Snuff and Santa Fe. The RJR Tobacco segment consists of the primary operations of R. J. Reynolds Tobacco Company. The American Snuff... More
Sector: Consumer Goods
Country: United States
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