President Donald Trump sent global markets into a tailspin last week with a dramatic tariff hike — the steepest in more than a century. Some countries now face duties as high as 50%, and China faces cumulative tariffs of 104%. The sweeping tariffs, starting at a minimum of 10% on nearly all U.S. imports, strike hardest at nations running hefty trade surpluses.
Markets faltered under the weight of uncertainty.
Yet, in the eye of the storm, the tobacco titan Philip Morris (PM) charted a different course. Its shares have surged nearly 25% year-to-date. Moreover, on April 3, shares hit a fresh 52-week high of $163.08.
The company is leaning heavily on its smoke-free future, with the ZYN nicotine pouch gaining traction. In turbulent times, consumer staples often become the port in a storm, and Philip Morris may well be that safe anchorage investors are searching for.
About Philip Morris Stock
Philip Morris International (PM), the name behind the legendary Marlboro brand, is charting a new course. Once synonymous with cigarettes, the company is now lighting the way toward a smoke-free future
Backed by a market cap of $235 billion, the company’s offerings stretch across cigarettes, innovative smoke-free products under the IQOS and ZYN brands, vapor devices, oral nicotine, and even wellness and healthcare goods. Accessories like lighters and matches also sit in the mix.
PM stock has surged 65% over the past year, far outpacing the S&P 500 Index’s ($SPX) decline of 4.2%.
Investor sentiment is reflected in its rich valuation, trading at 21 times forward adjusted earnings and 2.62 times sales, both comfortably sitting above industry averages. This shows a vote of confidence in the company’s forward momentum.
Further sweetening the pot, the company pays an annualized forward dividend of $5.40, offering a yield of 3.62%.
Philip Morris Surpasses Q4 Earnings
On Feb. 6, Philip Morris delivered its fourth quarter results, outpacing analyst forecasts on both the top and bottom lines. Revenue climbed by 7.3% year-over-year, reaching $9.7 billion and sailing past the forecast $9.4 billion.
For the first time, smoke-free products made up 40% of total net revenue and approximately 42% of adjusted gross profit. Adjusted EPS locked in at $1.55 and comfortably cleared analyst expectations of $1.50.
Fueled by robust performance in its combustible products segment, Philip Morris achieved a major milestone in 2024 by surpassing $10 billion in adjusted net earnings. Moreover, operating cash flow for the fiscal year set a record at $12.2 billion, well above initial and revised forecasts, backed by strong profit execution and favorable working capital dynamics.
Looking ahead, the company expects 2025 first quarter adjusted EPS to range between $1.58 and $1.63. For full year 2025, Philip Morris anticipates a 6% to 8% increase in organic net revenue, along with a 10.5% to 12.5% rise in organic operating income.
Operating cash flow is expected to reach $11 billion. Additionally, the company forecasts an adjusted EPS range of $7.04 to $7.17, marking a 9.1% increase from 2024.
What Do Analysts Expect for Philip Morris Stock?
Wall Street has a largely bullish outlook, assigning PM a consensus rating of “Moderate Buy.” Out of the 12 analysts tracking the stock, eight signal a “Strong Buy,” one leans towards a “Moderate Buy,” two advise to “Hold,” and only one urges a “Strong Sell.”
The average price target now sits at $154.40, hinting at modest upside.
