Do Altria’s Dividends Make Up For A Lagging Stock?
Selling Marlboro cigarettes and nicotine pouches generates the cash Altria Group (MO) uses to pay its dividend. Over the past year, those dividends added about 7.6 percentage points to the stock’s return. Yet over a five-year timeline, the share price rose less than the S&P 500. Take a guess: once every dividend is counted, did a five-year Altria holder end up ahead of the market or behind it?
How Far Has Altria Stock Trailed The Market?
Investors tracking price appreciation alone from October 6, 2021, to October 14, 2026, would conclude that Altria stock trailed the S&P 500 by 19.6 percentage points. The shares gained 57.4% during that period, while the S&P 500 climbed 77.0%. A simple glance at a stock chart points to an underperforming asset.
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How Much Did Altria’s Dividends Add?
Factoring in payouts changes the calculation. Reinvesting those dividends added 73.8 percentage points to the five-year return. This brought the return on Altria stock to 131.2% over those years. Dividends, not the share price, generated more than half of what an Altria holder earned.
Did The Dividends Close The Gap For Altria Holders?
Altria more than closed the performance gap. This holds even after factoring in the broader market’s dividends, as the table illustrates.
| Return from Oct 6, 2021 to Oct 14, 2026 | On price alone | With dividends reinvested |
|---|---|---|
| The stock | +57.4% | +131.2% |
| S&P 500 | +77.0% | +88.7% |
Before taxes and costs. The S&P 500 is measured through the SPDR S&P 500 ETF.
With dividends included, the S&P 500 returned 88.7% over the same five years. That leaves Altria 42.5 percentage points ahead. The cash paid out by the company turned a stock that trailed the market on price into one that beat it.
That advantage disappears over a longer time horizon. Over ten years, the S&P 500 with dividends beat Altria with dividends by 189.9 percentage points.
What This Means If You Own Altria For Income
Income investors rely on dividends to generate the bulk of their returns in Altria, accepting modest share price growth in the process. S&P 500 dividends added just under one percentage point to the index return over the past year, far less than Altria dividends did. Over five years, that stream of cash more than made up for the slower share price.
The cash comes from tobacco. Most of Altria’s sales come from smokeable products. Net revenues for those items, which include excise taxes, fell 3.4% in fiscal 2025.
Tracking the stock’s return with dividends alongside the S&P 500 offers a clearer picture for income holders than looking at the dividend in isolation.
Your Advisor Retired? Get A Second Opinion Before You Settle
For Altria holders, the dividend checks tell a different story from the price chart. When the advisor who built your plan moves on, it is a natural moment to ask whether the plan still fits the life you have now. Glenn Caldicott, CIO of our Boston-based partner firm Empirical Asset Management, an SEC-registered investment adviser, offers a free review of your holdings, fees, and income plan.