Low PE Ratio Indicates Value
Strong Free Cash Flow Yield
Strong Profit Margins
Strong Interest Coverage
💰 Strong Financial Performance
🚀 Innovation in Smoke-Free Products
📈 Competitive Position in Premium Segment
🌱 Growth in Smoke-Free Alternatives
🔍 Regulatory Opportunities
📊 Strategic Investment Plans
High Price to Sales Ratio
Negative Price to Book Ratio
Negative Return on Equity
High Debt Levels
Weak Liquidity Ratios
📉 Declining Cigarette Volumes
⚠️ Illicit Market Challenges
🔄 Reassessment of Goals
💡 Patent Challenges
Overall, Altria demonstrates a solid business model with a strong focus on innovation within smoke-free products. However, challenges such as declining cigarette volumes and the illicit market threaten its growth potential. The company remains committed to strategic investments and navigating the regulatory landscape to enhance future opportunities.
Analysis Date: January 30, 2025
Last Updated: March 12, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$255.43
Current Market Price: $55.84
IV/P Ratio: 4.57x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
78.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for MO
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (8.45)
P/B ratio ≤ 1.5 (-42.54)
Current ratio ≥ 2.0 (0.51x)
Long-term debt < Net current assets (-5.48x)
Margin of safety (78.0%)
MO does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
The company has high gross profit margin (70.27%) and net profit margin (55.10%), indicating efficient cost management and strong profitability.
The return on equity (ROE) of -3.26% is concerning, indicating that the company is not effectively using shareholders' equity to generate profits.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
-325.64%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
8.64%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
70.27%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
55.10%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
An interest coverage ratio of 10.38 suggests that the company can comfortably meet its interest obligations, indicating solid financial health.
A debt-to-equity ratio of -11.14 and a debt-to-assets ratio of 70.86% indicate significant leverage, which may pose risks in a downturn.
Current (0.51) and quick ratios (0.39) below 1.0 indicate potential liquidity issues, suggesting that the company may struggle to cover short-term obligations.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
-11.39x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
0.51x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
Altria demonstrated solid financial results with a 3.4% growth in adjusted diluted earnings per share and over $10.2 billion returned to shareholders through dividends and share repurchases.
Altria is actively investing in smoke-free alternatives, with NJOY's significant growth in market share and volume, as well as the introduction of innovative products like on! and Ploom.
Marlboro continues to hold a strong position in the premium cigarette segment, maintaining a retail share of 59.4%, indicating strong brand equity.
Domestic cigarette volumes declined by 10.2% for the year, reflecting ongoing challenges in the smokable product segment and shifts towards smoke-free alternatives.
The growth of illicit disposable e-vapor products poses a significant threat to Altria's market share and the overall regulatory environment, complicating their strategy for smoke-free products.
The increasing adoption of smoke-free products presents a significant opportunity for Altria, with the potential to shift millions of smokers to FDA-authorized alternatives.
The potential for improved regulatory oversight and enforcement against illicit products could enhance the market for legitimate smoke-free products, benefiting Altria's growth.
Altria plans to invest in market activities for smoke-free products and continue research and development, indicating a commitment to long-term growth.
Altria is reassessing its 2028 enterprise goals due to the unexpected growth of the illicit e-vapor market, which may hinder future growth targets.
Ongoing litigation and patent challenges, particularly regarding NJOY, could impact the company's ability to capitalize on the e-vapor market effectively.