UBS Upgrades Altria Group (MO) as E-Cigarette Crackdown Supports Earnings Stability

Altria Group, Inc. (NYSE:MO) ranks among the top consumer staples stocks according to hedge funds. On July 2, UBS raised its price target for Altria Group, Inc. (NYSE:MO) from $47 to $59 and upgraded it from Sell to Neutral. The firm stated that stronger regulation against illegal e-cigarette imports, especially from China, might reduce pressure on cigarette volumes and maintain earnings growth.

The increase in enforcement, according to UBS, might improve industry trends by approximately 100 basis points, reducing the annual fall in cigarette volumes to -8% from a previous prediction of 9% or worse.

Due to improved volume performance, cost reductions of more than $600 million, and targeted price investment in its affordable Basic brand, UBS now projects that Altria’s earnings would remain stable through 2026.

UBS anticipates that Altria Group, Inc. will post a 10.5% decline in cigarette shipments and group earnings per share of $1.41, somewhat higher than the $1.38 consensus, ahead of the company’s second-quarter results.

Altria Group, Inc. is a prominent American company that produces and markets tobacco, cigarettes, and associated products on a global scale. The firm has also ventured into next-generation nicotine products, such as oral nicotine pouches and electronic vaping devices.

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