Ten-Year Tally: Philip Morris International Stock Delivers $75 Bil Gain

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PM: Philip Morris International logo
PM
Philip Morris International

In the last decade, Philip Morris International (PM) stock has returned a notable $75 Bil back to its shareholders through cold, hard cash via dividends and buybacks. Let’s look at some numbers and compare how this payout power stacks up against the market’s biggest capital-return machines.

As it turns out, PM stock has returned the 30th highest amount to shareholders in history.

  PM S&P Median
Dividends $74 Bil $4.4 Bil
Share Repurchase $984 Mil $5.6 Bil
Total Returned $75 Bil $9.2 Bil
Total Returned as % of Current Market Cap 32.4% 25.6%

Why should you care? Because dividends and share repurchases represent direct, tangible returns of capital to shareholders. They also signal management’s confidence in the company’s financial health and ability to generate sustainable cash flows. And there are more stocks like that. Here is a list of the top 10 companies ranked by total capital returned to shareholders via dividends and stock repurchases.

The question isn’t where PM stock goes, but how your portfolio is positioned. See how Trefis High Quality Portfolio and our Boston-based, wealth management partner prepare you.

Relevant Articles
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  2. PM Has Returned $74 Bil To Shareholders In A Decade
  3. PM Has Paid Out $74 Bil to Investors in the Past Decade
  4. PM Stock Up 5.6% after 5-Day Win Streak
  5. PM Stock Down -13% after 5-Day Loss Streak
  6. PM Dropped 8.4% In A Day. Just a Blip, or the Start?

Top 10 Stocks By Total Shareholder Return

  Total Money Returned As % Of Current Market Cap via Dividends via Share Repurchases
AAPL $847 Bil 21.1% $141 Bil $706 Bil
MSFT $364 Bil 9.5% $165 Bil $199 Bil
GOOGL $343 Bil 10.2% $12 Bil $331 Bil
XOM $212 Bil 42.9% $145 Bil $67 Bil
WFC $208 Bil 73.9% $59 Bil $150 Bil
META $178 Bil 11.3% $7.7 Bil $171 Bil
JPM $174 Bil 20.2% $0.0 $174 Bil
ORCL $161 Bil 22.9% $34 Bil $126 Bil
JNJ $157 Bil 34.8% $104 Bil $52 Bil
CVX $153 Bil 57.9% $97 Bil $55 Bil

For full ranking, visit Buybacks & Dividends Ranking

What do you notice here? The total capital returned to shareholders as a % of the current market cap appears inversely proportional to growth prospects for reinvestments. Stocks like Meta (META) and Microsoft (MSFT) are growing much faster, in a more predictable way, compared to the others, but they have returned a much lower fraction of their market cap to shareholders.

That’s the flip side to high capital returns. Sure, they are attractive, but you have to ask yourself the question: Am I sacrificing growth and sound fundamentals? With that in mind, let’s look at some numbers for PM. (see Buy or Sell Philip Morris International Stock for more details)

Philip Morris International Fundamentals

  • Revenue Growth: 7.5% LTM and 8.0% last 3-year average.
  • Cash Generation: Nearly 25.3% free cash flow margin and 37.1% operating margin LTM.
  • Recent Revenue Shocks: The minimum annual revenue growth in the last 3 years for PM was 7.5%.
  • Valuation: Philip Morris International stock trades at a P/E multiple of 26.8

  PM S&P Median
Sector Consumer Staples
Industry Tobacco
PE Ratio 26.8 23.8

   
LTM* Revenue Growth 7.5% 5.6%
3Y Average Annual Revenue Growth 8.0% 5.3%
Min Annual Revenue Growth Last 3Y 7.5% -0.0%

   
LTM* Operating Margin 37.1% 18.8%
3Y Average Operating Margin 35.9% 18.2%
LTM* Free Cash Flow Margin 25.3% 13.4%

*LTM: Last Twelve Months

That’s a good overview, but evaluating a stock from an investment perspective involves much more. That is exactly what Trefis High Quality Portfolio does. It is designed to reduce stock-specific risk while giving upside exposure.

PM Historical Risk

PM isn’t immune to big drops. It fell about 41% in both the Global Financial Crisis and the 2018 Correction. During the Covid sell-off, it still dipped nearly 32%, and even the recent Inflation Shock took it down around 23%. Good fundamentals matter, but history shows PM can still get hit hard when markets turn sour.

But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, and outlook changes. Read PM Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.

The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.