Philip Morris International (PM)
Market Price (10/31/2026): $208.07 | Market Cap: $324.3 BilInvestor Relations Sector: Consumer Staples | Industry: Tobacco
Philip Morris International (PM)
Market Price (10/31/2026): $208.07Market Cap: $324.3 BilSector: Consumer StaplesIndustry: Tobacco
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 6.1%, Dividend Yield is 2.8% Attractive operating marginsOp Mgn LTMOperating Margin = Operating Income / Revenue Reflects profitability before taxes and before impact of capital structure (interest payments). is 39% Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 35%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 32%, CFO LTM is 15 Bil, FCF LTM is 14 Bil Low stock price volatilityVol 12M is 28% Megatrend and thematic driversMegatrends include Consumer Lifestyle Transformation. Themes include Tobacco Harm Reduction, Next-Generation Nicotine Products, Smoke-Free Product Innovation, Show more. | Trading close to highsDist 52W High is 0.0%, Dist 3Y High is 0.0% | Expensive valuation multiplesP/SPrice/Sales ratio is 7.5x Key risksPM key risks include [1] targeted regulatory and legal challenges against its core smoke-free products like IQOS and Zyn, Show more. |
| Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 6.1%, Dividend Yield is 2.8% |
| Attractive operating marginsOp Mgn LTMOperating Margin = Operating Income / Revenue Reflects profitability before taxes and before impact of capital structure (interest payments). is 39% |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 35%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 32%, CFO LTM is 15 Bil, FCF LTM is 14 Bil |
| Low stock price volatilityVol 12M is 28% |
| Megatrend and thematic driversMegatrends include Consumer Lifestyle Transformation. Themes include Tobacco Harm Reduction, Next-Generation Nicotine Products, Smoke-Free Product Innovation, Show more. |
| Trading close to highsDist 52W High is 0.0%, Dist 3Y High is 0.0% |
| Expensive valuation multiplesP/SPrice/Sales ratio is 7.5x |
| Key risksPM key risks include [1] targeted regulatory and legal challenges against its core smoke-free products like IQOS and Zyn, Show more. |
Qualitative Assessment
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Philip Morris International (PM) stock has gained about 15% since 6/30/2026 because of the following key factors:
1. Robust Fiscal Q3 2026 Earnings Beat and Upbeat Outlook.
Philip Morris International reported strong financial results for fiscal Q3 2026 (ended September 30, 2026), with adjusted diluted earnings per share (EPS) of $2.36, surpassing analysts' consensus estimates of $2.30 by $0.06. Quarterly revenue reached $11.44 billion, exceeding estimates of $11.32 billion, driven by 7.1% organic growth. The company also projected organic revenue growth of 5% to 7% and adjusted EPS growth of 7.5% to 9.5% for the full fiscal year 2026, signaling confidence in sustained momentum.
2. Accelerated Growth in Smoke-Free Products.
The company continued its strong performance in its smoke-free product (SFP) portfolio, which accounted for over 40% of total net revenues in fiscal Q3 2026. Shipments of SFPs increased by 2.7%, with notable growth in the nicotine pouch brand ZYN (up 4% in U.S. shipments) and the VEEV e-vapor product (surging 62%). IQOS maintained its lead in the global heated tobacco unit (HTU) category, further solidifying PMI's transition to a smoke-free future.
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Philip Morris International (PM) stock has gained about 15% since 6/30/2026 because of the following key factors:
1. Robust Fiscal Q3 2026 Earnings Beat and Upbeat Outlook.
Philip Morris International reported strong financial results for fiscal Q3 2026 (ended September 30, 2026), with adjusted diluted earnings per share (EPS) of $2.36, surpassing analysts' consensus estimates of $2.30 by $0.06. Quarterly revenue reached $11.44 billion, exceeding estimates of $11.32 billion, driven by 7.1% organic growth. The company also projected organic revenue growth of 5% to 7% and adjusted EPS growth of 7.5% to 9.5% for the full fiscal year 2026, signaling confidence in sustained momentum.
2. Accelerated Growth in Smoke-Free Products.
The company continued its strong performance in its smoke-free product (SFP) portfolio, which accounted for over 40% of total net revenues in fiscal Q3 2026. Shipments of SFPs increased by 2.7%, with notable growth in the nicotine pouch brand ZYN (up 4% in U.S. shipments) and the VEEV e-vapor product (surging 62%). IQOS maintained its lead in the global heated tobacco unit (HTU) category, further solidifying PMI's transition to a smoke-free future.
3. Significant Dividend Increase.
On September 18, 2026, Philip Morris International announced an 8.8% increase in its regular quarterly dividend, raising it from $1.47 to $1.60 per share, or an annualized rate of $6.40 per share. This marked another consecutive annual dividend increase, enhancing shareholder returns and signaling confidence in future cash flows.
4. Positive Analyst Sentiment and Price Target Revisions.
During the period, several Wall Street analysts reaffirmed or upgraded their ratings and price targets for PM, contributing to positive market sentiment. For example, Barclays increased its price objective from $205.00 to $225.00 in July 2026, and Needham & Company raised its target from $200.00 to $215.00 in July 2026. The stock held a "Moderate Buy" consensus rating with an average price target of $209.70 as of late October 2026.
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Stock Movement Drivers
Fundamental Drivers
The 16.4% change in PM stock from 6/30/2026 to 10/30/2026 was primarily driven by a 20.7% change in the company's P/E Multiple.| (LTM values as of) | 6302026 | 10302026 | Change |
|---|---|---|---|
| Stock Price ($) | 179.37 | 208.79 | 16.4% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 41,493 | 43,138 | 4.0% |
| Net Income Margin (%) | 26.7% | 24.8% | -7.2% |
| P/E Multiple | 25.2 | 30.4 | 20.7% |
| Shares Outstanding (Mil) | 1,558 | 1,559 | -0.1% |
| Cumulative Contribution | 16.4% |
Market Drivers
6/30/2026 to 10/30/2026| Return | Correlation | |
|---|---|---|
| PM | 16.4% | |
| Market (SPY) | 1.2% | -30.2% |
| Sector (XLP) | 7.6% | 65.4% |
Fundamental Drivers
The 28.4% change in PM stock from 3/31/2026 to 10/30/2026 was primarily driven by a 36.3% change in the company's P/E Multiple.| (LTM values as of) | 3312026 | 10302026 | Change |
|---|---|---|---|
| Stock Price ($) | 162.59 | 208.79 | 28.4% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 40,648 | 43,138 | 6.1% |
| Net Income Margin (%) | 27.9% | 24.8% | -11.1% |
| P/E Multiple | 22.3 | 30.4 | 36.3% |
| Shares Outstanding (Mil) | 1,556 | 1,559 | -0.2% |
| Cumulative Contribution | 28.4% |
Market Drivers
3/31/2026 to 10/30/2026| Return | Correlation | |
|---|---|---|
| PM | 28.4% | |
| Market (SPY) | 16.5% | -19.9% |
| Sector (XLP) | 9.8% | 59.1% |
Fundamental Drivers
The 34.5% change in PM stock from 9/30/2025 to 10/30/2026 was primarily driven by a 17.8% change in the company's Net Income Margin (%).| (LTM values as of) | 9302025 | 10302026 | Change |
|---|---|---|---|
| Stock Price ($) | 155.20 | 208.79 | 34.5% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 39,058 | 43,138 | 10.4% |
| Net Income Margin (%) | 21.1% | 24.8% | 17.8% |
| P/E Multiple | 29.3 | 30.4 | 3.6% |
| Shares Outstanding (Mil) | 1,556 | 1,559 | -0.2% |
| Cumulative Contribution | 34.5% |
Market Drivers
9/30/2025 to 10/30/2026| Return | Correlation | |
|---|---|---|
| PM | 34.5% | |
| Market (SPY) | 14.4% | -10.3% |
| Sector (XLP) | 16.5% | 57.8% |
Fundamental Drivers
The 155.1% change in PM stock from 9/30/2023 to 10/30/2026 was primarily driven by a 92.5% change in the company's P/E Multiple.| (LTM values as of) | 9302023 | 10302026 | Change |
|---|---|---|---|
| Stock Price ($) | 81.86 | 208.79 | 155.1% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 33,170 | 43,138 | 30.1% |
| Net Income Margin (%) | 24.3% | 24.8% | 2.3% |
| P/E Multiple | 15.8 | 30.4 | 92.5% |
| Shares Outstanding (Mil) | 1,552 | 1,559 | -0.4% |
| Cumulative Contribution | 155.1% |
Market Drivers
9/30/2023 to 10/30/2026| Return | Correlation | |
|---|---|---|
| PM | 155.1% | |
| Market (SPY) | 82.9% | 3.9% |
| Sector (XLP) | 40.0% | 52.3% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| PM Return | 21% | 12% | -2% | 34% | 38% | 34% | 230% |
| Peers Return | 12% | -6% | 23% | 27% | 19% | -6% | 84% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 13% | 106% |
Monthly Win Rates [3] | |||||||
| PM Win Rate | 67% | 50% | 58% | 67% | 75% | 70% | |
| Peers Win Rate | 50% | 48% | 55% | 57% | 60% | 56% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 50% | |
Max Drawdowns [4] | |||||||
| PM Max Drawdown | -18% | -23% | -14% | -9% | -21% | -19% | |
| Peers Max Drawdown | -24% | -31% | -17% | -25% | -30% | -39% | |
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: ISPR, PM, MO, TPB, UVV. See PM Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 10/30/2026 (YTD)
How Low Can It Go
| Event | PM | S&P 500 |
|---|---|---|
| 2023 SVB Regional Banking Crisis | ||
| % Loss | -12.0% | -6.7% |
| % Gain to Breakeven | 13.7% | 7.1% |
| Time to Breakeven | 328 days | 31 days |
| 2020 COVID-19 Crash | ||
| % Loss | -30.5% | -33.7% |
| % Gain to Breakeven | 43.9% | 50.9% |
| Time to Breakeven | 261 days | 140 days |
| Q4 2018 Fed Policy Error / Growth Scare | ||
| % Loss | -19.2% | -19.2% |
| % Gain to Breakeven | 23.8% | 23.8% |
| Time to Breakeven | 52 days | 105 days |
| 2016-2017 Trump Reflation Bond Selloff | ||
| % Loss | -12.2% | -3.7% |
| % Gain to Breakeven | 13.8% | 3.9% |
| Time to Breakeven | 80 days | 6 days |
| 2013 Taper Tantrum | ||
| % Loss | -18.7% | -0.2% |
| % Gain to Breakeven | 23.0% | 0.2% |
| Time to Breakeven | 275 days | 1 days |
| 2011 US Debt Ceiling Crisis & European Contagion | ||
| % Loss | -13.3% | -17.9% |
| % Gain to Breakeven | 15.4% | 21.8% |
| Time to Breakeven | 24 days | 123 days |
In The Past
Philip Morris International's stock fell 0.0% during the 2025 US Tariff Shock. Such a loss loss requires a 0.0% gain to breakeven.
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| Event | PM | S&P 500 |
|---|---|---|
| 2020 COVID-19 Crash | ||
| % Loss | -30.5% | -33.7% |
| % Gain to Breakeven | 43.9% | 50.9% |
| Time to Breakeven | 261 days | 140 days |
| 2008-2009 Global Financial Crisis | ||
| % Loss | -32.4% | -53.4% |
| % Gain to Breakeven | 47.9% | 114.4% |
| Time to Breakeven | 143 days | 1085 days |
In The Past
Philip Morris International's stock fell 0.0% during the 2025 US Tariff Shock. Such a loss loss requires a 0.0% gain to breakeven.
Preserve Wealth
Limiting losses and compounding gains is essential to preserving wealth.
Asset Allocation
Actively managed asset allocation strategies protect wealth. Learn more.
About Philip Morris International (PM)
Philip Morris International (PM) is a leading global tobacco company that manufactures and sells a diverse portfolio of nicotine-containing products. While the company is historically known for traditional combustible cigarettes, it is strategically focused on developing and marketing smoke-free alternatives, aiming to replace cigarettes with scientifically substantiated, less harmful products.
The company's product offerings include a wide array of internationally recognized cigarette brands such as Marlboro, Parliament, Bond Street, Chesterfield, and L&M, along with various localized brands in specific markets. Crucially, PM is a pioneer in the smoke-free category, spearheaded by its IQOS platform. This platform features heated tobacco products under brands like HEETS, Fiit, and Miix, as well as nicotine-containing vapor products, all supported by their proprietary electronic devices and accessories.
Philip Morris International boasts an extensive global reach, distributing and marketing its products across numerous continents. Its primary markets span the European Union, Eastern Europe, the Middle East, Africa, South and Southeast Asia, East Asia, Australia, Latin America, and Canada, serving a vast international customer base with both its traditional and innovative smoke-free offerings.
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The Coca-Cola of tobacco products.
The PepsiCo of nicotine products.
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- Cigarettes: Philip Morris International manufactures and sells a wide range of traditional tobacco cigarettes globally.
- Smoke-free Products (IQOS): The company offers heated tobacco and nicotine-containing vapor products designed as potentially less harmful alternatives to traditional smoking.
- Related Electronic Devices and Accessories: These include the electronic devices and accompanying accessories necessary for using their smoke-free product lines.
- Other Nicotine-containing Products: Philip Morris International also provides various other products containing nicotine.
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Philip Morris International (PM) primarily sells its products to individual consumers. Based on its product offerings and global market presence, the company serves the following categories of adult customers:
- Adult Smokers of Conventional Cigarettes: This category includes adult consumers who purchase and use traditional combustible cigarette brands such as Marlboro, Parliament, Bond Street, Chesterfield, and L&M.
- Adult Consumers of Heated Tobacco Products: This category comprises adult smokers who are transitioning to or exclusively using smoke-free heated tobacco products like IQOS, HEETS, Fiit, and Miix, seeking alternatives to conventional cigarettes.
- Adult Consumers of Other Nicotine-Containing Vapor Products: This category encompasses adult users of the company's nicotine-containing vapor products, which offer an alternative to traditional smoking.
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Jacek Olczak, Group CEO PMI
Appointed Group CEO PMI in January 2026, Mr. Olczak previously served as PMI's Chief Executive Officer since May 2021. He began his career with PMI in 1993, holding finance and general management positions across Europe, including Managing Director of PMI's markets in Poland and Germany and President of the European Union Region. He was appointed Chief Financial Officer in 2012 and Chief Operating Officer in 2018. Before joining PMI, Mr. Olczak worked for BDO Binder. He holds a master's degree in economics from the University of Lodz, Poland. He is a key driver of PMI's transformation towards a smoke-free future, expanding the company's product portfolio into wellness and healthcare.
Emmanuel Babeau, Group Chief Financial Officer
Mr. Babeau was appointed Group Chief Financial Officer in January 2026, having served as PMI's Chief Financial Officer since May 2020. Prior to joining PMI, he spent over a decade at Schneider Electric, where he served as Deputy CEO in charge of Finance and Legal Affairs. He joined Schneider Electric in 2009 as Executive Vice President, Finance and a member of the Management Board. From 1993 to 2009, he worked at Pernod Ricard, initially as an Internal Auditor, and then in several executive positions, including Chief Financial Officer and Group Deputy Managing Director. He started his career at Arthur Andersen in 1990. Mr. Babeau sits on the board of Davide Campari-Milano N.V. and previously served as Vice Chairman of AVEVA Group plc and as an independent director at Sanofi S.A. and Sodexo.
Scott Coutts, Chief Global Operations Officer
Mr. Coutts was appointed Chief Global Operations Officer in January 2026, having served as PMI's Senior Vice President, Operations since January 2023. He oversees PMI's manufacturing footprint, supply chain, and related functions. Mr. Coutts joined PMI in 1995 as an Operations trainee at Philip Morris Australia. He held positions of increasing responsibility in various geographies, including Indonesia, Lithuania, and Russia. In 2016, he was appointed Vice President, Reduced-Risk Products Manufacturing and Supply Chain, and in 2018, Vice President, Global Manufacturing.
Moira Gilchrist, Chief Global Communications Officer
Dr. Gilchrist was appointed Chief Global Communications Officer in January 2026, having served as PMI's Chief Communications Officer since January 2024. Before that, she was Vice President, Strategic and Scientific Communications, a role she assumed in 2018. Since joining PMI in 2006, Dr. Gilchrist has held several positions, including leading the Reduced-Risk Products Corporate Affairs team, Director of Scientific Engagement within the R&D function, and working in both product development and commercialization. Prior to joining the company, Dr. Gilchrist worked in the pharmaceutical sector for more than a decade.
Stefano Volpetti, Chief Global Growth Officer
Mr. Volpetti became Chief Global Growth Officer in January 2026. He was previously President, Smoke-Free Products Category & Chief Consumer Officer since May 2025. He joined PMI in 2019 as Chief Consumer Officer. Before joining PMI, Mr. Volpetti worked at Procter & Gamble for 22 years and also served as Chief Marketing Officer at Luxottica Eyewear in 2015.
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- Declining cigarette consumption volumes and increasing regulatory and taxation pressures on traditional tobacco products. The global trend towards reduced smoking due to health awareness campaigns, public smoking bans, and increased excise taxes consistently pressures the company's traditional cigarette business, which still forms a significant portion of its revenue.
- Regulatory scrutiny and potential restrictions on smoke-free products. While Philip Morris International is strategically investing in and expanding its portfolio of smoke-free products like IQOS, these products are not immune to evolving regulatory landscapes. Governments globally may impose stricter marketing limitations, flavor bans, or higher taxes as the long-term health impacts are further studied and debated, potentially hindering the growth and profitability of these next-generation products.
- Intense competition within the rapidly growing smoke-free and reduced-risk product categories. As the market for heated tobacco and e-vapor products expands, Philip Morris International faces increasing competition from other established tobacco companies and new entrants. This heightened competition could lead to pricing pressures, increased marketing and research & development expenses, and challenges in maintaining or gaining market share for its innovative products.
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The expanding legalization and growing consumer adoption of cannabis and cannabis-derived products (e.g., vapes, edibles, beverages) present a clear emerging threat. As these products become more accessible and destigmatized in various global markets where Philip Morris International operates, they represent an alternative for adult consumers seeking relaxation, recreation, or stress relief. This trend could potentially divert discretionary spending and shift consumption habits away from nicotine products, impacting PM's core cigarette business and its strategic focus on smoke-free alternatives like IQOS.
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Philip Morris International (PM) operates in several significant addressable markets for its main products and services, including traditional cigarettes, heated tobacco products, e-cigarettes and vaping products, and nicotine pouches.
Cigarettes
The global cigarette market was valued at approximately USD 1,143.4 billion in 2024 and is projected to reach USD 1,380.2 billion by 2033. The Asia-Pacific region holds the largest share of the global cigarette market, while the Middle East and Africa region is experiencing the fastest growth.
Heated Tobacco Products (Smoke-Free Products like IQOS)
The global heated tobacco products market, which includes products like IQOS, was estimated at USD 49.14 billion in 2024. This market is projected for substantial growth, with some estimates indicating it could reach USD 898.86 billion by 2030, growing at a compound annual growth rate (CAGR) of 63.2% from 2025 to 2030. The Asia Pacific region accounted for a dominant revenue share of 68.9% in the global market for heated tobacco products in 2024, with Japan being a major adopter.
E-cigarettes and Vaping Products (Nicotine-Containing Vapor Products)
The global e-cigarette and vape market size was estimated at USD 45.74 billion in 2025. Projections show this market could reach USD 462.14 billion by 2033, with a CAGR of 34.1% from 2026 to 2033. North America held a significant share of the market, accounting for 43.5% in 2025.
Nicotine Pouches
The global nicotine pouches market was estimated at USD 7.5 billion in 2024. This market is expected to grow to USD 44.2 billion by 2034, at a CAGR of 19.9%. North America dominated the nicotine pouches market with 78.9% of the revenue share in 2024.
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Philip Morris International (PM) is set to drive future revenue growth over the next 2-3 years through several strategic initiatives, primarily focusing on its smoke-free product portfolio and leveraging its market position.
Here are 3-5 expected drivers of future revenue growth:
- Expansion and Innovation in Smoke-Free Products (IQOS, ZYN, VEEV): The company's most significant revenue growth driver is the continued global expansion and innovation within its smoke-free product categories. This includes heated tobacco units (HTUs) under the IQOS brand, which is seeing new variants like IQOS ILUMA and TEREA, and is the core driver of smoke-free growth. Additionally, nicotine pouches, particularly the ZYN brand acquired through Swedish Match, are experiencing rapid volume growth in key markets like the U.S. and Europe, fueled by expanded manufacturing capacity. The e-vapor product VEEV also contributes to this portfolio expansion.
- Strategic Geographic Market Expansion for Smoke-Free Portfolio: Philip Morris International is aggressively expanding the availability of its smoke-free products into new geographies and increasing penetration in existing markets. A notable upcoming driver is the re-entry of IQOS into the U.S. market in 2024-2025, following the termination of its licensing agreement with Altria, which is expected to accelerate growth. The company aims to make IQOS available in over 100 markets by mid-decade and its overall smoke-free portfolio reached 106 markets by Q4 2025.
- Sustained Pricing Power Across Product Categories: Philip Morris International consistently benefits from its ability to implement strategic price increases across both its smoke-free and traditional combustible tobacco products. This pricing power contributes significantly to organic net revenue growth, helping to offset the declining volumes of conventional cigarettes while enhancing profitability from the growing smoke-free segments.
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Share Repurchases
- In June 2021, Philip Morris International authorized a new share repurchase program of up to $7 billion, with target spending of $5 billion to $7 billion over a three-year period.
- The company strategically paused share repurchases in 2025 to focus capital allocation on strategic investments and dividend growth.
- Philip Morris International made an "insignificant amount" of $209 million in share repurchases in 2022.
Share Issuance
- Philip Morris' shares outstanding showed slight increases from 1.552 billion in December 2022 to 1.558 billion in December 2025, representing minor annual increases between 0.06% and 0.19%.
Outbound Investments
- In 2021, Philip Morris International acquired Fertin Pharma for approximately $820 million and American inhaled drug specialist OtiTopic for an undisclosed sum. Additionally, it made an unconditional offer to acquire the U.K. pharmaceutical company Vectura for £1 billion.
- In March 2022, Philip Morris International acquired an 82.59% stake in Swedish Match for $16 billion, strengthening its position in alternative nicotine products, notably the Zyn nicotine pouch brand.
- PM Equity Partner, Philip Morris International's venture capital arm, invests in early-stage and growth-stage companies within life sciences, industrial technologies, consumer engagement, and product technologies.
Capital Expenditures
- Capital expenditures in 2025 were approximately $1.6 billion, primarily directed towards investments supporting the smoke-free business.
- For 2026, expected capital expenditures are projected to be between $1.4 billion and $1.6 billion, predominantly allocated to supporting the smoke-free business.
- From 2019 to 2023, Philip Morris International invested over €2.3 billion in research and development across Europe to drive innovation and scientific advancements.
Peer Outperformance in Tobacco
| Industry | Names | 1Y med | 3Y med | 5Y med | Top 3 by 5Y |
|---|---|---|---|---|---|
| Consumer Staples Merchandise Retail | 12 | 21.8% | 55.5% | 64.4% | WMT 164% · PSMT 148% · COST 117% |
| Food Distributors | 8 | 8.1% | 34.9% | 64.2% | CHEF 199% · USFD 199% · PFGC 119% |
| Tobacco ← | 6 | -28.9% | 11.3% | 51.6% | PM 178% · MO 160% |
| Food Retail | 6 | 4.3% | 57.3% | 45.8% | CASY 265% · SFM 124% · KR 86% |
| Soft Drinks & Non-alcoholic Beverages | 13 | 6.5% | -6.3% | 13.4% | COKE 449% · COCO 333% · CCHGY 124% |
| Brewers | 3 | -2.3% | -22.6% | 7.4% | BUD 41% · TAP 7% · SAM -59% |
| Household Products | 19 | 19.5% | 2.1% | -10.2% | IPAR 43% · CL 41% · CHD 30% |
| Personal Care Products | 4 | 11.1% | 16.6% | -15.7% | ELF 246% · PG 29% · COTY -60% |
| Agricultural Products & Services | 11 | -11.8% | -11.1% | -34.1% | ADM 38% · BG 19% · INGR 17% |
| Packaged Foods & Meats | 48 | -24.6% | -31.6% | -34.6% | CALM 128% · TR 42% · SJM 27% |
| Distillers & Vintners | 5 | -34.6% | -55.4% | -71.9% | STZ -31% · BF-B -53% |
| Drug Retail | 3 | -34.2% | -44.7% | -95.0% |
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Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 68.91 |
| Mkt Cap | 65.8 |
| Rev LTM | 11,744 |
| Op Inc LTM | 6,259 |
| FCF LTM | 4,618 |
| FCF 3Y Avg | 4,491 |
| CFO LTM | 4,820 |
| CFO 3Y Avg | 4,632 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 5.1% |
| Rev Chg 3Y Avg | 5.2% |
| Rev Chg Q | 4.5% |
| QoQ Delta Rev Chg LTM | 1.2% |
| Op Inc Chg LTM | -6.2% |
| Op Inc Chg 3Y Avg | 2.9% |
| Op Mgn LTM | 26.7% |
| Op Mgn 3Y Avg | 29.4% |
| QoQ Delta Op Mgn LTM | -0.6% |
| CFO/Rev LTM | 21.4% |
| CFO/Rev 3Y Avg | 23.6% |
| FCF/Rev LTM | 18.6% |
| FCF/Rev 3Y Avg | 20.7% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 65.8 |
| P/S | 4.5 |
| P/Op Inc | 14.4 |
| P/EBIT | 12.8 |
| P/E | 30.5 |
| P/CFO | 17.6 |
| Total Yield | 7.9% |
| Dividend Yield | 4.1% |
| FCF Yield 3Y Avg | 5.2% |
| D/E | 0.2 |
| Net D/E | 0.1 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | 10.0% |
| 3M Rtn | -6.2% |
| 6M Rtn | -2.9% |
| 12M Rtn | -12.0% |
| 3Y Rtn | 142.5% |
| 1M Excs Rtn | 10.5% |
| 3M Excs Rtn | -16.1% |
| 6M Excs Rtn | -10.0% |
| 12M Excs Rtn | -25.6% |
| 3Y Excs Rtn | 42.6% |
Comparison Analyses
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Combustible tobacco products | 23,794 | 23,218 | 22,334 | 21,572 | 22,067 |
| Smoke-free | 16,854 | 14,660 | 12,840 | 10,190 | 9,338 |
| Total | 40,648 | 37,878 | 35,174 | 31,762 | 31,405 |
| $ Mil | 2015 | 2014 | 2013 | 2012 | 2011 |
|---|---|---|---|---|---|
| European Union | 3,576 | 3,727 | 4,238 | 4,187 | 4,560 |
| Eastern Europe,Middle East and Africa | 3,425 | 4,121 | 3,779 | 3,726 | 3,229 |
| Latin America and Canada | 2,886 | 1,030 | 1,134 | 1,043 | 988 |
| Asia | 1,085 | 3,187 | 4,622 | 5,197 | 4,836 |
| Other | -349 | -363 | -258 | -307 | -281 |
| Total | 10,623 | 11,702 | 13,515 | 13,846 | 13,332 |
Price Behavior
| Market Price | $208.79 | |
| Market Cap ($ Bil) | 325.5 | |
| First Trading Date | 03/17/2008 | |
| Distance from 52W High | 0.0% | |
| 50 Days | 200 Days | |
| DMA Price | $193.21 | $179.40 |
| DMA Trend | up | up |
| Distance from DMA | 8.1% | 16.4% |
| 3M | 1YR | |
| Volatility | 23.4% | 28.0% |
| Downside Capture | -99.28 | -49.80 |
| Upside Capture | -42.26 | 0.38 |
| Correlation (S&P 500) | -30.1% | -8.0% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | -0.45 | -0.46 | -0.61 | -0.39 | -0.17 | 0.08 |
| Up Beta | -0.81 | -0.79 | -1.54 | -0.31 | -0.05 | 0.14 |
| Down Beta | -1.88 | -1.65 | 0.03 | -0.41 | -0.10 | 0.22 |
| Up Capture | -28% | -19% | -26% | -13% | -6% | 3% |
| Bmk +ve Days | 6 | 16 | 27 | 66 | 132 | 424 |
| Stock +ve Days | 11 | 23 | 34 | 69 | 135 | 429 |
| Down Capture | -17% | -27% | -76% | -100% | -62% | -61% |
| Bmk -ve Days | 16 | 26 | 37 | 60 | 120 | 328 |
| Stock -ve Days | 11 | 19 | 30 | 57 | 116 | 319 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with PM | |
|---|---|---|---|---|
| PM | 47.5% | 28.0% | 1.37 | - |
| Sector ETF (XLP) | 19.3% | 15.2% | 0.94 | 58.6% |
| Equity (SPY) | 10.9% | 12.8% | 0.52 | -7.8% |
| Gold (GLD) | -2.0% | 28.6% | -0.08 | -5.7% |
| Commodities (DBC) | 48.2% | 20.6% | 1.79 | -5.9% |
| Real Estate (VNQ) | 10.2% | 13.7% | 0.45 | 30.1% |
| Bitcoin (BTCUSD) | -30.3% | 43.5% | -0.71 | -5.8% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with PM | |
|---|---|---|---|---|
| PM | 22.1% | 23.4% | 0.81 | - |
| Sector ETF (XLP) | 7.3% | 13.9% | 0.30 | 54.6% |
| Equity (SPY) | 12.2% | 17.1% | 0.53 | 18.5% |
| Gold (GLD) | 16.2% | 19.0% | 0.68 | 7.6% |
| Commodities (DBC) | 9.2% | 19.5% | 0.35 | 3.8% |
| Real Estate (VNQ) | 0.9% | 18.9% | -0.06 | 34.9% |
| Bitcoin (BTCUSD) | 4.8% | 51.6% | 0.28 | 2.3% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with PM | |
|---|---|---|---|---|
| PM | 13.6% | 24.8% | 0.52 | - |
| Sector ETF (XLP) | 8.4% | 15.0% | 0.42 | 62.9% |
| Equity (SPY) | 15.2% | 17.9% | 0.72 | 39.1% |
| Gold (GLD) | 11.4% | 16.5% | 0.56 | 7.0% |
| Commodities (DBC) | 8.2% | 18.1% | 0.37 | 14.4% |
| Real Estate (VNQ) | 5.3% | 20.7% | 0.21 | 45.6% |
| Bitcoin (BTCUSD) | 61.7% | 66.2% | 1.01 | 8.4% |
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Returns Analyses
Earnings Returns History
Updated 10/30/2026| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 10/21/2026 | -1.2% | 1.4% | |
| 7/22/2026 | 3.3% | 6.5% | 1.0% |
| 4/22/2026 | 7.0% | 8.2% | 23.1% |
| 2/6/2026 | -0.5% | 2.6% | -5.4% |
| 10/21/2025 | -3.8% | -3.1% | -1.4% |
| 7/22/2025 | -8.4% | -12.6% | -6.5% |
| 4/23/2025 | 2.4% | 3.7% | 6.4% |
| 2/6/2025 | -0.6% | 2.7% | 3.6% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 16 | 16 | 14 |
| # Negative | 9 | 9 | 10 |
| Median Positive | 2.1% | 3.7% | 6.4% |
| Median Negative | -1.7% | -2.7% | -5.0% |
| Max Positive | 10.5% | 9.7% | 23.1% |
| Max Negative | -8.4% | -12.6% | -14.7% |
| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 10/21/2026 | -1.2% | 1.4% | |
| 7/22/2026 | 3.3% | 6.5% | 1.0% |
| 4/22/2026 | 7.0% | 8.2% | 23.1% |
| 2/6/2026 | -0.5% | 2.6% | -5.4% |
| 10/21/2025 | -3.8% | -3.1% | -1.4% |
| 7/22/2025 | -8.4% | -12.6% | -6.5% |
| 4/23/2025 | 2.4% | 3.7% | 6.4% |
| 2/6/2025 | -0.6% | 2.7% | 3.6% |
| 10/22/2024 | 10.5% | 9.7% | 8.9% |
| 7/23/2024 | 2.2% | 6.7% | 11.0% |
| 4/23/2024 | 3.8% | 1.6% | 6.6% |
| 2/8/2024 | 0.1% | -0.0% | 6.1% |
| 10/19/2023 | -2.7% | -3.4% | -2.1% |
| 7/20/2023 | -0.6% | -0.5% | -5.4% |
| 4/20/2023 | -4.7% | -3.3% | -8.8% |
| 2/9/2023 | 0.3% | -1.7% | -4.6% |
| 10/20/2022 | -1.7% | 3.6% | 10.0% |
| 7/21/2022 | 4.2% | 7.9% | 11.9% |
| 4/21/2022 | 2.0% | -1.3% | -2.5% |
| 2/10/2022 | 2.8% | 6.5% | -14.7% |
| 10/19/2021 | 1.3% | 0.4% | -2.3% |
| 7/20/2021 | 1.7% | 5.2% | 6.3% |
| 4/20/2021 | 0.2% | 0.5% | 2.5% |
| 2/4/2021 | 0.8% | 2.1% | 3.3% |
| 10/20/2020 | 0.7% | -2.7% | 5.6% |
| SUMMARY STATS | |||
| # Positive | 16 | 16 | 14 |
| # Negative | 9 | 9 | 10 |
| Median Positive | 2.1% | 3.7% | 6.4% |
| Median Negative | -1.7% | -2.7% | -5.0% |
| Max Positive | 10.5% | 9.7% | 23.1% |
| Max Negative | -8.4% | -12.6% | -14.7% |
Recent Forward Guidance
Updated 10/22/2026Latest: Q3 2026 Earnings Reported 10/21/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q4 2026 Regular Quarterly Dividend per Share | Reported | 1.6 | ||||||
| 2026 Amortization of Acquired Intangibles per Share | Reported | 0.5 | ||||||
| 2026 Operating Cash Flow | Reported | 13.50 Bil | 0.0% | Affirmed | Guidance: 13.50 Bil for 2026 | |||
| 2026 Annualized Dividend per Share | Reported | 6.4 | ||||||
| 2026 Organic Net Revenue Growth | Reported | 5.0% | 6.0% | 7.0% | 0.0% | Affirmed | Guidance: 6.0% for 2026 | |
| 2026 Organic Operating Income Growth | Reported | 7.0% | 8.0% | 9.0% | 0.0% | Affirmed | Guidance: 8.0% for 2026 | |
| 2026 Net Debt to Adjusted EBITDA Ratio | Reported | 2 | ||||||
| 2026 Effective Tax Rate | Reported | 21.5% | ||||||
| 2026 Reported Diluted EPS | Reported | 7.11 | 7.19 | 7.26 | -1.1% | Lowered | Guidance: 7.27 for 2026 | |
| 2026 Total EPS Adjustments | Reported | 1.18 | ||||||
| 2026 Adjusted Diluted EPS | Reported | 8.29 | 8.37 | 8.44 | 0.4% | Raised | Guidance: 8.34 for 2026 | |
| 2026 Adjusted Diluted EPS Growth | Reported | 9.9% | 10.9% | 11.9% | ||||
| 2026 Currency Impact on Adjusted Diluted EPS | Reported | 0.18 | ||||||
| 2026 Adjusted Diluted EPS, excluding currency | Reported | 8.11 | 8.19 | 8.26 | 0.0% | Affirmed | Guidance: 8.19 for 2026 | |
| 2026 Adjusted Diluted EPS Growth, excluding currency | Reported | 7.5% | 8.5% | 9.5% | ||||
| 2026 Capital Expenditures | Reported | 1.40 Bil | 1.50 Bil | 1.60 Bil | 0.0% | Affirmed | Guidance: 1.50 Bil for 2026 | |
| 2026 Share Repurchases | Reported | 0 | ||||||
Prior: Q2 2026 Earnings Reported 7/22/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q3 2026 Adjusted Diluted EPS | Reported | 2.2 | 2.23 | 2.25 | Higher New | |||
| 2026 Operating Cash Flow | Reported | 13.50 Bil | 0.0% | Affirmed | Guidance: 13.50 Bil for 2026 | |||
| 2026 Net Revenue Growth | Reported | 5.0% | 6.0% | 7.0% | 0.0% | Affirmed | Guidance: 6.0% for 2026 | |
| 2026 Organic Operating Income Growth | Reported | 7.0% | 8.0% | 9.0% | 0.0% | Affirmed | Guidance: 8.0% for 2026 | |
| 2026 Reported Diluted EPS | Reported | 7.19 | 7.27 | 7.34 | -4.8% | Lowered | Guidance: 7.64 for 2026 | |
| 2026 Adjusted Diluted EPS | Reported | 8.26 | 8.34 | 8.41 | -1.2% | Lowered | Guidance: 8.44 for 2026 | |
| 2026 Adjusted Diluted EPS, excluding currency | Reported | 8.11 | 8.19 | 8.26 | ||||
| 2026 Capital Expenditures | Reported | 1.40 Bil | 1.50 Bil | 1.60 Bil | 0.0% | Affirmed | Guidance: 1.50 Bil for 2026 | |
Q1 2026 Earnings Reported 4/22/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q2 2026 Adjusted Diluted EPS | Reported | 2.02 | 2.05 | 2.07 | ||||
| 2026 Operating Cash Flow | Reported | 13.50 Bil | 0.0% | Affirmed | Guidance: 13.50 Bil for 2026 | |||
| 2026 Net Revenue Growth | Reported | 5.0% | 6.0% | 7.0% | 0.0% | Affirmed | Guidance: 6.0% for 2026 | |
| 2026 Organic Operating Income Growth | Reported | 7.0% | 8.0% | 9.0% | 0.0% | Affirmed | Guidance: 8.0% for 2026 | |
| 2026 Reported Diluted EPS | Reported | 7.56 | 7.64 | 7.71 | -3.9% | Lowered | Guidance: 7.95 for 2026 | |
| 2026 Adjusted Diluted EPS | Reported | 8.36 | 8.44 | 8.51 | -0.2% | Lowered | Guidance: 8.46 for 2026 | |
| 2026 Capital Expenditures | Reported | 1.40 Bil | 1.50 Bil | 1.60 Bil | 0.0% | Affirmed | Guidance: 1.50 Bil for 2026 | |
Q4 2025 Earnings Reported 2/6/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| Q1 2026 Adjusted Diluted EPS | Reported | 1.8 | 1.83 | 1.85 | ||||
| 2026 Operating Cash Flow | Reported | 13.50 Bil | 17.4% | Higher New | Actual: 11.50 Bil for 2025 | |||
| 2026 Net Revenue Growth | Reported | 5.0% | 6.0% | 7.0% | -1.0% | Lower New | Actual: 7.0% for 2025 | |
| 2026 Organic Operating Income Growth | Reported | 7.0% | 8.0% | 9.0% | -2.8% | Lower New | Actual: 10.75% for 2025 | |
| 2026 Reported Diluted EPS | Reported | 7.87 | 7.95 | 8.02 | 6.8% | Higher New | Actual: 7.44 for 2025 | |
| 2026 Adjusted Diluted EPS | Reported | 8.38 | 8.46 | 8.53 | 12.6% | Higher New | Actual: 7.51 for 2025 | |
| 2026 Adjusted Diluted EPS, excluding currency | Reported | 8.11 | 8.19 | 8.26 | 10.5% | Higher New | Actual: 7.41 for 2025 | |
| 2026 Capital Expenditures | Reported | 1.40 Bil | 1.50 Bil | 1.60 Bil | -6.2% | Lower New | Actual: 1.60 Bil for 2025 | |
| 2028 Net Revenue Growth (CAGR) | Reported | 6.0% | 7.0% | 8.0% | ||||
| 2028 Operating Income Growth (CAGR) | Reported | 8.0% | 9.0% | 10.0% | ||||
| 2028 Adjusted Diluted EPS Growth (CAGR) | Reported | 9.0% | 10.0% | 11.0% | ||||
Insider Activity
Updated 5/8/2026| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Dobrowolski, Reginaldo | Group Controller | Direct | Sell | 2202026 | 183.46 | 5,000 | 917,300 | 3,886,050 | Form |
| 2 | Dobrowolski, Reginaldo | Group Controller | Spouse | Sell | 2202026 | 183.58 | 1,000 | 183,580 | 1,331,689 | Form |
| 3 | Kennedy, Stacey | CEO PMI U.S. | Direct | Sell | 2202026 | 183.13 | 14,350 | 2,627,916 | 8,295,972 | Form |
| 4 | Babeau, Emmanuel | Group Chief Financial Officer | Direct | Sell | 2202026 | 181.61 | 33,800 | 6,138,418 | 29,868,125 | Form |
| 5 | Guerin, Yann | Group Chief Legal Officer | Direct | Sell | 2202026 | 181.69 | 4,000 | 726,760 | 6,252,316 | Form |
| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Dobrowolski, Reginaldo | Group Controller | Direct | Sell | 2202026 | 183.46 | 5,000 | 917,300 | 3,886,050 | Form |
| 2 | Dobrowolski, Reginaldo | Group Controller | Spouse | Sell | 2202026 | 183.58 | 1,000 | 183,580 | 1,331,689 | Form |
| 3 | Kennedy, Stacey | CEO PMI U.S. | Direct | Sell | 2202026 | 183.13 | 14,350 | 2,627,916 | 8,295,972 | Form |
| 4 | Babeau, Emmanuel | Group Chief Financial Officer | Direct | Sell | 2202026 | 181.61 | 33,800 | 6,138,418 | 29,868,125 | Form |
| 5 | Guerin, Yann | Group Chief Legal Officer | Direct | Sell | 2202026 | 181.69 | 4,000 | 726,760 | 6,252,316 | Form |
| 6 | Olczak, Jacek | Group CEO PMI | Direct | Sell | 2202026 | 182.18 | 80,000 | 14,574,400 | 115,200,430 | Form |
| 7 | De, Wilde Frederic | CEO PMI International | Direct | Sell | 2202026 | 182.58 | 20,000 | 3,651,600 | 24,376,804 | Form |
Investor Activity (13F)
Updated Oct 31, 2026Active managers (13F portfolio over $250M, at least 3 holdings) with a position over $5M that is either over 10% of their portfolio or held in a concentrated book of 50 or fewer total positions. Index/ETF, sovereign, bank, community-bank and charitable/donor-advised filers are excluded.
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Caledonia Investments PLC | $116.1 Mil | 13.6% | 15 | Hold | 13F |
| GQG Partners LLC | $8.3 Bil | 13.1% | 86 | TRIM -9.1% | 13F |
| Contrarius Group Holdings Ltd | $136.0 Mil | 7.7% | 47 | ADD +1532.6% | 13F |
| Gladstone Capital Management LLP | $66.8 Mil | 6.7% | 32 | Hold | 13F |
| Fundsmith LLP | $845.4 Mil | 6.6% | 34 | TRIM -16.5% | 13F |
| Fundsmith Investment Services LTD. | $277.4 Mil | 6.3% | 24 | TRIM -19.8% | 13F |
| Investment Management Associates Inc /Adv | $19.8 Mil | 5.4% | 27 | Hold | 13F |
| Independent Franchise Partners LLP | $423.4 Mil | 3.0% | 26 | TRIM -33.0% | 13F |
| Hamlin Capital Management, LLC | $121.0 Mil | 2.9% | 30 | Hold | 13F |
| Kinsale Capital Group, Inc. | $15.8 Mil | 2.5% | 41 | Hold | 13F |
| Keystone Financial Planning, Inc. | $5.8 Mil | 1.6% | 40 | TRIM -54.6% | 13F |
| Cincinnati Specialty Underwriters Insurance CO | $5.4 Mil | 1.3% | 46 | New | 13F |
| Brandywine Trust Co | $5.1 Mil | 0.9% | 31 | Hold | 13F |
| Troy Asset Management Ltd | $21.6 Mil | 0.6% | 30 | TRIM -6.6% | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | As Of | Filing |
|---|---|---|---|---|---|---|
| Lone Pine Capital LLC | $424.0 Mil | 3.1% | 32 | Exited | Dec 31, 2025 | 13F |
| Atreides Management, LP | $65.1 Mil | 1.4% | 49 | Exited | Dec 31, 2025 | 13F |
| Hook Mill Capital Partners, LP | $15.7 Mil | 1.5% | 39 | Exited | Dec 31, 2025 | 13F |
| Keystone Financial Planning, Inc. | $5.8 Mil | 1.6% | 40 | TRIM -54.6% | Mar 31, 2026 | 13F |
| Independent Franchise Partners LLP | $423.4 Mil | 3.0% | 26 | TRIM -33.0% | Mar 31, 2026 | 13F |
| Fundsmith Investment Services LTD. | $277.4 Mil | 6.3% | 24 | TRIM -19.8% | Mar 31, 2026 | 13F |
| Fundsmith LLP | $845.4 Mil | 6.6% | 34 | TRIM -16.5% | Mar 31, 2026 | 13F |
| GQG Partners LLC | $8.3 Bil | 13.1% | 86 | TRIM -9.1% | Mar 31, 2026 | 13F |
| Troy Asset Management Ltd | $21.6 Mil | 0.6% | 30 | TRIM -6.6% | Mar 31, 2026 | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| GQG Partners LLC | $8.3 Bil | 13.1% | 86 | TRIM -9.1% | 13F |
| Fundsmith LLP | $845.4 Mil | 6.6% | 34 | TRIM -16.5% | 13F |
| Independent Franchise Partners LLP | $423.4 Mil | 3.0% | 26 | TRIM -33.0% | 13F |
| Fundsmith Investment Services LTD. | $277.4 Mil | 6.3% | 24 | TRIM -19.8% | 13F |
| Contrarius Group Holdings Ltd | $136.0 Mil | 7.7% | 47 | ADD +1532.6% | 13F |
| Hamlin Capital Management, LLC | $121.0 Mil | 2.9% | 30 | Hold | 13F |
| Caledonia Investments PLC | $116.1 Mil | 13.6% | 15 | Hold | 13F |
| Gladstone Capital Management LLP | $66.8 Mil | 6.7% | 32 | Hold | 13F |
| Troy Asset Management Ltd | $21.6 Mil | 0.6% | 30 | TRIM -6.6% | 13F |
| Investment Management Associates Inc /Adv | $19.8 Mil | 5.4% | 27 | Hold | 13F |
| Kinsale Capital Group, Inc. | $15.8 Mil | 2.5% | 41 | Hold | 13F |
| Keystone Financial Planning, Inc. | $5.8 Mil | 1.6% | 40 | TRIM -54.6% | 13F |
| Cincinnati Specialty Underwriters Insurance CO | $5.4 Mil | 1.3% | 46 | New | 13F |
| Brandywine Trust Co | $5.1 Mil | 0.9% | 31 | Hold | 13F |
PM Trade Sentinel
High Conviction
CONVICTION RATIONALE
Conviction is high as Philip Morris is executing a margin-accretive pivot to smoke-free products. The international smoke-free business has a 70% gross margin, and robust pricing in combustibles (+9.1% YTD) funds the transition. Management raised 2026 adjusted EPS guidance to a range of $8.29-$8.44, signaling confidence in the strategy.
STOCK ARCHETYPE
Recurring Consumption / Brand Franchise(Volume of Combustibles × Price per Unit) + (Volume of Smoke-Free Products × Price per Unit) The mix shift from lower-margin combustibles to higher-margin smoke-free products, combined with operating leverage as the SFP business scales.
INVESTMENT THESIS
Yes, the transition is structurally accretive, with higher-margin smoke-free products more than offsetting legacy declines.
- International smoke-free gross margin was 70% year-to-date, exceeding the 68.8% for combustibles.
- Combustible pricing power remains strong, contributing +9.1% to growth year-to-date.
- The company is on track for its sixth consecutive year of total shipment volume growth.
- FY2026 adjusted diluted EPS guidance was raised, now representing 10% to 12% growth.
- Total international market share for cigarettes and HTUs surpassed 30% for the first time in Q3.
PRIMARY RISK
Heavy investment in the US ZYN brand could permanently reset margins lower, while global regulators could treat new products like cigarettes, stifling the primary growth engine.
- Management guides for Q4 US adjusted operating income to be around zero or slightly negative.
- The ZYN can transition reduces revenue per pouch by approximately 25%, a significant price investment.
- Litigation related to ZYN in the US has been ongoing since March 2024.
- Accounts receivable grew 12.2% in the latest quarter, outpacing revenue growth of 5.5%.
| KPI | Status | Rationale |
|---|---|---|
| Smoke-Free Product (SFP) Shipment Volume Growth | +2.7% year-over-year for Q3 2026 - Decelerating | The year-over-year growth rate for Smoke-Free Product shipments has decelerated sequentially through 2026. Management attributes the Q3 slowdown to a "strong prior year comparison." Underlying demand appears more robust, with IQOS adjusted in-market sales (IMS) volume growth accelerating to +7.1% in the quarter. |
| Combustible (Cigarette) Shipment Volume Growth | Flat (0.6%) year-over-year for Q2 2026 - Turning around | The performance of the legacy combustible business has shown significant improvement throughout 2026, moving from a decline to stable volumes. Management noted the Q3 performance exceeded expectations and reflects the resilience of the category in markets where smoke-free alternatives have limited presence. |
| Heated Tobacco Unit (HTU) Shipment Volume | 41.5 billion units (Q3 2026) | Measures the volume growth of the core IQOS heat-not-burn business, a primary engine of the company's smoke-free transformation. |
| Combustible Pricing Variance | +9.1% (Year-to-date Q3 2026) | Demonstrates the significant pricing power of the legacy cigarette business, which generates the cash flow needed to fund the smoke-free transition and shareholder returns. |
| Smoke-Free Products as % of Net Revenues | 38.6% (FY 2025) | Tracks the progress of the company's strategic transformation away from combustibles. The company has a goal of becoming a majority smoke-free company. |
US Profit Dip: Strategic Investment or Margin Reset?
BULL VIEW
Bulls see the guided Q4 US profit dip to near-zero as a smart, temporary investment to solidify ZYN's market leadership and long-term value, funded by a strong international business.
CORE TENSION
Can strong international profits, with 70% smoke-free gross margins, justify the Q4 US investment that will reduce ZYN revenue per pouch by approximately 25%?
PREVAILING SENTIMENT
The latest evidence favors the bulls. The company raised its full-year 2026 adjusted EPS guidance despite the planned US investment, signaling confidence in the overall business's strength.
BEAR VIEW
Bears fear this is the start of a value-destructive price war in a key growth market, permanently impairing the profitability profile of the company's most important new segment.
| Timeline | Event & Metric To Watch |
|---|---|
11/9/2026 | Peer Earnings Report Watch: Peer Turning Point Brands (TPB) is scheduled to report earnings. |
the fourth quarter | US Profitability Update Watch: Company expects an abnormally low level of U.S. profitability with adjusted Operating Company Income (OCI) around 0 or slightly negative due to investments. |
Q4 | HTU Shipment Volume Update Watch: Company forecasts Heated Tobacco Unit (HTU) shipment volumes of 39.5 billion to 40.5 billion units. |
1/28/2027 | Altria Oral Nicotine Read-Through Watch: Altria's reported volumes for its oral nicotine products and management commentary on category trends and promotional environment. |
2/4/2027 | US Segment Profitability Collapse Watch: Q4 U.S. segment operating income results and management's 2027 outlook for U.S. margin recovery. |
2/4/2027 | Company Earnings Report Watch: The company is scheduled to report its next quarterly earnings. |
2/8/2027 | Peer Earnings Report Watch: Peer Universal (UVV) is scheduled to report earnings. |
April 2027 | Japan Excise Tax Increase Watch: The first increase in the harmonized Heated Tobacco Product (HTP) and cigarette excise tax in Japan will occur. |
No set date | Inflationary and Geopolitical Cost Headwinds Watch: Gross and operating margin performance in the Q4 report, and any quantification of cost headwinds in 2027 guidance. |
| Date | Event | Stock Impact |
|---|---|---|
2026-10-21 | Q3 Results Beat and Guidance Updated Details: The company reported Q3 organic net revenue growth of 7.1% and raised its full-year 2026 guidance for Adjusted Diluted EPS by 0.4% to a new midpoint of $8.37. | +0.9% $199.90 -> $201.74 |
2026-09-18 | Dividend Increased Significantly Details: The Board of Directors increased the regular quarterly dividend by 8.8% to an annualized rate of $6.40 per share. | -1.6% $188.86 -> $185.89 |
2026-08-21 | FDA Authorizes New Nicotine Pouches Details: The U.S. Food and Drug Administration authorized 11 new nicotine pouch products from Philip Morris, citing lower levels of harmful constituents compared to other smokeless tobacco products. | -0.0% $189.89 -> $189.83 |
2026-07-22 | Q2 Results Beat Expectations Details: The company reported Q2 results with organic net revenue growth of 7.6% and organic growth in adjusted operating income. The stock reacted positively by 2.0%. | +1.6% $186.44 -> $189.50 |
2026-05-20 | CFO Succession Announced Details: The company announced that Massimo Andolina was appointed Group Chief Financial Officer, effective August 1, 2026, succeeding Emmanuel Babeau. | -1.6% $188.38 -> $185.32 |
2026-04-22 | Strong Q1 Earnings Reaction Details: The company reported its Q1 2026 results, which were followed by a 10.0% positive two-day stock reaction, the largest around an earnings call in the past year. | +10.4% $150.70 -> $166.37 |
Position Sizing
4% - 6%
NORMAL POSITION
Sizing is volatility-based: PM trades at roughly 23% annualized realized (three-month) volatility versus about 10% for the S&P 500 (2.3x the market). A 4% - 6% position keeps a single-name swing of that size within a diversified portfolio's risk budget.
Diversification Alternatives
MO - Altria Group, Inc.
Pure-Play US ExposureAltria offers focused exposure to the US market and has a significantly higher operating margin of 59.9% compared to Philip Morris's 38.6%, but much lower revenue growth.
TPB - Turning Point Brands
High-Growth Niche PlayerTurning Point Brands is a much smaller company but exhibited trailing-twelve-month revenue growth of 24.5%, far outpacing Philip Morris's 7.9%, offering a higher-risk, higher-growth profile.
A consumer staples giant executing a multi-decade pivot from a declining, high-margin business (cigarettes) to a growing, even higher-margin one (smoke-free alternatives), using the legacy segment's cash flow to fund the transition.
Philip Morris is leveraging its formidable global distribution, brand equity, and R&D to lead the tobacco industry's shift to smoke-free products like IQOS and ZYN. This transition is structurally accretive to both revenue growth and profitability. The legacy combustible business, led by the Marlboro franchise, remains a highly resilient and cash-generative engine that funds both the SFP investments and substantial shareholder returns. The investment thesis hinges on the pace of SFP adoption outpacing the managed decline of combustibles.
Sustained high single-digit or double-digit growth in SFP volumes, continued strong pricing power in combustibles, and expanding SFP margins would confirm the thesis.
A regulatory crackdown that treats SFPs like cigarettes (e.g., flavor bans, prohibitive taxes), a sharp acceleration in combustible volume declines, or a failure of new SFP innovations to gain traction would damage the thesis.
Quarterly volatility in shipment volumes versus in-market sales (IMS) due to inventory movements or timing of price increases.
Repricing Catalyst
Successful execution of the ZYN portfolio expansion and value proposition adjustment in the U.S., leading to re-accelerated volume and market share gains in the critical nicotine pouch category.
International Smoke-Free
$18.0B TTM (42% of Total)What It Is
Sells a portfolio of smoke-free products to adult nicotine users outside of the United States. This includes IQOS heat-not-burn devices and consumables (HTUs), VEEV e-vapor products, and ZYN oral nicotine pouches.
Who Pays & How
Adult smokers and nicotine users purchase products through various retail and online channels. They are seeking alternatives to cigarettes that are perceived to be less harmful, driven by product innovation and taste.
Competition
Philip Morris International — Investor Video Playlist
Industry Resources
| Consumer Staples Resources |
| FoodNavigator |
| Consumer Goods Technology (CGT) |
| Beverage Digest |
| Tobacco Resources |
| Tobacco Reporter |
| Tobacco Journal International |
| CSP Daily News - Tobacco |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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