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Philip Morris: Smoke-Free Prospects And Attractive Dividend Suggest Upside Potential

Acutel profile picture


  • With a risk of a recession hanging over markets, investors may want to consider quality defensive stocks such as Philip Morris.
  • PM has a dominant market position in the tobacco industry as well as a track record of profitable operations and consistent dividend growth, with a current yield of 5%+.
  • The company is in the midst of a major transition from having cigarettes as its core business to having smoke-free products as its core business.
  • This shift could bode well for profitability and growth given the emerging class of consumers adopting smoke-free nicotine use and the higher margin per user for these products.
  • At present valuations, the downside risk is limited while the potential for a move higher is significant given the presence of near-term catalysts such as a recession and the imminent entry of PM's smoke-free brands into the US.

The girl smokes an electronic cigarette on the street.

OLGA Zhukovskaya/iStock via Getty Images

Philip Morris International (NYSE:PM) is a tobacco industry stalwart that raked in annual revenues of $31.76 billion in FY2022. This makes it the second largest tobacco multinational by annual sales after British American Tobacco (

This article was written by

Acutel profile picture
We are global investors who invest in good companies at fair valuation and speculate on all else, subject to the risk exposure we can afford

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Comments (3)

PM management is doing a fantastic, near-miraculous job converting PM to a smokeless company.
Long BTI.
BAHAMAS1 profile picture
Long PM
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