Table of Contents :
• Stock Rating & Target Price
• Investment Thesis
• Fundamental Models Used
• Company Description
• Corporate Timeline
• Key Metrics (KPI ) and Recently Reported Earnings Review
• Business Highlights, Strategic Announcements & Outlook
• Quarter-over-Quarter (Q-o-Q) and Year-over-Year (Y-o-Y) Growth Analysis
• Key Catalysts Driving Growth
• Historical Financial Statement Analysis & CAGR Trends
• Quarterly Key Financial Ratios and Performance Metrics
• Annual Financial Performance Analysis: Horizontal and Vertical Financial Analysis, Trends
• Financial Forecasts
• Annual Forecasts: Income Statement
• Annual Forecasts: Cash Flow Statements
• Net Debt Levels
• A Closer Look at DCF: Our Assumptions and Methodology
• Terminal Value Calculation
• Target Price Analysis
• Valuation Multiples
• Supplementary Valuation Analysis: Multiples Approach
• Scenario/Sensitivity Analysis – Base Case , Bull Case ,Bear Case
• Holistic Peer Review & Trading Comps: Financial Data, Operational Metrics, and Valuation Multiples
• Implied Price Per Share
• Ownership Activity/ Insider Trades
• Ownership Summary
• An analysis of ESG Risk Rating
• Key Professionals
• Key Board Members
• Key Risks Considerations
• Analyst Ratings
• Analyst Industry Views
• Disclosures
Altria (MO): Battling Illicit Market Pressures—Evaluating Key Cost & Profit Drivers Amid Challenging Market Dynamics
Altria's second-quarter 2024 results reveal a business navigating both pressures and opportunities. The company faces a continued decrease in cigarette volumes, exacerbated by macroeconomic challenges and the rise of illicit e-vapor products, which now account for more than 60% of the market. Nicotine pouches and alternative tobacco products are gaining traction, further intensifying competition. Nonetheless, Altria's investment in smoke-free options, particularly its acquisition of NJOY and the growth of the on! brand, indicates a strategic shift toward future growth. With FDA approval for menthol e-vapor products and the introduction of NJOY’s ACE 2.0 with access control, Altria is reinforcing its foothold in the vapor segment. Improved supply chain logistics, strategic retail placement, and focused marketing efforts are expected to enhance adoption. The company also anticipates that regulatory actions against illicit products could support its recovery in the e-vapor market. Altria reaffirmed its adjusted EPS guidance for 2024 at $5.07 to $5.15, reflecting a 2.5%-4% increase, with more substantial earnings growth expected in the latter half due to additional shipping days and the integration of NJOY. The smokeable products business will benefit from the Q4 end of legal settlement payments, providing some margin relief. Although cigarette volumes have dropped by an average of 5-6% per year since 2018, the Marlboro brand retains over 40% market share. Altria can continue raising prices given its strong brand and the relatively low affordability of cigarettes in the U.S. Despite setbacks such as its investments in Juul and Cronos and the loss of iQOS rights, the company’s emphasis on NJOY and its established smokeless brands like Copenhagen and Skoal offers some diversification. Traditional tobacco products will remain central to revenue until at least next three years. Initiation of Coverage :Earnings Review F2Q24, Forecasts,DCF, Valuation, Peer Analysis, ESG & Risks
