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In this share market blog you are going to get full stocks analysis of Tobacco companies of USA, so read it full.
So, let’s begin Full Stocks analysis of Tobacco Industry Stocks of USA.
U.S.-Listed Tobacco Companies Overview
| Company Name | Stock Symbol | Stock Price | Market Cap | Net Profit (TTM) | Index Membership |
|---|---|---|---|---|---|
| Philip Morris International | PM | $157.59 | $233.99B | $7.06B | S&P 500 |
| Altria Group Inc. | MO | $46.85 | $91.40B | $8.70B | S&P 500 |
| British American Tobacco | BTI | $38.50 | $78.99B | $2.70B | FTSE 100 |
| Turning Point Brands Inc. | TPB | $59.84 | $1.06B | $47M | Russell 2000 |
| 22nd Century Group Inc. | XXII | $0.35 | $5M | -$80M | None |
Financial & Fundamental Analysis of USA Tobacco company stocks :
| Company Name | Debt/Equity | P/E Ratio | P/B Ratio | ROE | ROA | Dividend Yield | EPS (TTM) |
|---|---|---|---|---|---|---|---|
| Altria Group Inc. (MO) | 2.45 (2023) | 10.77 | 8.92 | 85.20% | 20.78% | 7.45% | $5.80 |
| Philip Morris Intl. (PM) | 5.12 (2023) | 23.86 | Not available | 112.30% | 12.54% | 4.17% | $5.65 |
| British American Tobacco (BTI) | 1.38 | 10.27 | 1.23 | -21.50% | 5.16% | 9.50% (2023) | -$8.11 |
| Vector Group Ltd. (VGR) | 12.67 (2023) | 8.95 | Not available | Negative | 5.10% | 6.80% | $1.12 |
| Turning Point Brands (TPB) | 1.37 | 23.25 | 5.41 | 28.05% | 10.40% | 0.52% | $1.75 (est.) |
| 22nd Century Group (XXII) | Not available | 0.00 | 0.15 | -250.30% | -95.20% | 0.00% | -$8.50 |
| RLX Technology (RLX) | 0.05 (2023) | 25.40 | 1.50 | 4.22% | 3.80% | 0.00% | $0.08 |
| Imperial Brands (IMBBY) | 2.80 (2023) | 7.50 | 3.20 | 35.10% | 8.90% | 8.20% | $2.95 |
| Universal Corp. (UVV) | 0.45 (2023) | 10.27 | 0.90 | 8.70% | 5.30% | 6.10% | $4.20 |
| Schweitzer-Mauduit (SWM) | 1.60 (2023) | 15.80 | 1.80 | 11.20% | 4.50% | 3.40% | $2.10 |
| Scandinavian Tobacco (STG) | 0.65 | 9.51 | 1.01 | 10.84% | 5.78% | 7.61% | $1.45 (est.) |
Key Observations for Tobacco Companies of USA stocks :
- Profitability:
- Altria (MO) and Philip Morris (PM) have high ROE (85%+), driven by strong pricing power and dividends.
- 22nd Century (XXII) and British American Tobacco (BTI) show negative ROE, indicating financial struggles.
- Valuation:
- Low P/E: IMBBY (7.5), MO (10.77), BTI (10.27) suggest undervaluation.
- High P/E: PM (23.86), RLX (25.40) reflect growth expectations (PM’s smoke-free push, RLX’s vaping focus).
- Dividends:
- MO (7.45%), IMBBY (8.20%), STG (7.61%) offer high yields, typical for mature tobacco firms.
- TPB (0.52%) and RLX (0%) focus on reinvestment rather than dividends.
- Leverage:
- VGR (12.67 D/E) and PM (5.12 D/E) carry high debt, while STG (0.65) is more conservative.
Piotroski F-Score for Tobacco Companies of USA :
| Company | F-Score (Est.) | Key Weaknesses | Key Strengths |
|---|---|---|---|
| Altria (MO) | 7-8 | High debt (D/E ~2.45) | Strong ROA (20.78%), high dividend, +CFO |
| Philip Morris (PM) | 6-7 | Extreme leverage (D/E ~5.12) | High ROE (112%), growing smoke-free sales |
| British American (BTI) | 3-4 | Negative ROE (-21.5%), declining EPS | Improving cash flow, cost-cutting |
| Vector Group (VGR) | 4-5 | Very high debt (D/E ~12.67), low margins | Strong dividend coverage, stable sales |
| Turning Point (TPB) | 6-7 | High P/B (5.41), modest yield (0.52%) | Strong ROE (28%), improving margins |
| 22nd Century (XXII) | 0-1 | Negative ROA (-95.2%), cash burn | N/A (financially distressed) |
| RLX Technology (RLX) | 5-6 | Low ROE (4.22%), regulatory risks | Low debt (D/E ~0.05), +CFO |
| Imperial Brands (IMBBY) | 6-7 | Stagnant growth in traditional tobacco | High yield (8.2%), aggressive buybacks |
| Universal Corp (UVV) | 5-6 | Low growth (agric. focus) | Low debt (D/E ~0.45), stable cash flows |
| Scandinavian Tobacco (STG) | 7-8 | Limited geographic diversification | High yield (7.61%), efficient operations |
Key Take Aways :
- Strongest (F-Score 7+):
- Altria (MO), Scandinavian Tobacco (STG), Imperial Brands (IMBBY)
- High profitability, stable cash flows, and disciplined leverage.
- Moderate (F-Score 5-6):
- Philip Morris (PM), Turning Point (TPB), RLX Tech (RLX), Universal (UVV)
- Mixed efficiency metrics (e.g., PM’s high debt vs. RLX’s low debt).
- Weak (F-Score ≤4):
- British American (BTI), Vector Group (VGR), 22nd Century (XXII)
- Negative ROE/ROA, high leverage, or cash flow issues.
Credit Ratings of Major Tobacco Companies
| Company Name | Moody’s | S&P Global | Fitch | Outlook |
|---|---|---|---|---|
| Altria Group Inc. (MO) | A3 | BBB | BBB | Positive (S&P), Stable (Fitch) |
| Philip Morris International (PM) | Baa2 | A- | BBB+ | Stable (Moody’s/S&P/Fitch) |
| British American Tobacco (BTI) | Baa1 | BBB+ | BBB | Stable (Moody’s/S&P/Fitch) |
| Turning Point Brands (TPB) | Not rated | Not rated | B+ | Stable (Fitch) |
| Scandinavian Tobacco Group (STG) | Baa3 | BBB- | BBB- | Stable (Moody’s/S&P/Fitch) |
Key Observations:
- Highest-Rated:
- Philip Morris (PM) – A- (S&P) / BBB+ (Fitch)
- British American Tobacco (BTI) – BBB+ (S&P) / BBB (Fitch)
- Global diversification, strong cash flows, and reduced litigation risks.
- Lowest-Rated (Investment Grade):
- Scandinavian Tobacco (STG) – Baa3 (Moody’s) / BBB- (S&P/Fitch)
- Smaller scale, regional focus (Europe), and moderate leverage.
- Speculative Grade:
- Turning Point Brands (TPB) – B+ (Fitch only)
- Niche market (smokeless/vaping), higher financial risk.
- Stable Outlooks:
- All companies have stable outlooks except Altria (MO), which has a Positive outlook from S&P (likely due to smoke-free product growth).
Final Words :
Future Prospects & Investment Sentiment of Tobacco Companies of USA
| Company Name | Future Prospects | Investment Sentiment | Investment Horizon |
|---|---|---|---|
| Altria Group Inc. (MO) | Stable with moderate growth in smokeless and nicotine pouches. Increased regulatory pressure could affect traditional tobacco. | Bullish (due to strong market position in smokeless and reduced-risk products) | Long-term (focused on diversifying products beyond traditional tobacco) |
| Philip Morris International (PM) | Strong growth prospects with transition to reduced-risk products like IQOS. Expansion in emerging markets is key. | Bullish (due to innovation and geographic expansion) | Long-term (focused on smokeless technology and global presence) |
| British American Tobacco PLC (BTI) | Stable growth, with strong presence in vaping and reduced-risk tobacco. Potential regulatory hurdles in some markets. | Bullish (diversification into vaping and non-tobacco products) | Long-term (transitioning to a future beyond combustible tobacco) |
| Turning Point Brands Inc. (TPB) | Growing in niche markets like vaping and smokeless tobacco, but facing regulatory uncertainty. | Bullish (for short-term due to niche market growth) | Short-term (uncertain due to regulatory risks and market volatility) |
| Scandinavian Tobacco Group A/S (STG) | Strong performance in the cigar market with expanding U.S. market presence. Vulnerable to shifts in consumer preferences. | Bearish (due to reliance on traditional cigars, market facing headwinds) | Short-term (market uncertain, heavy reliance on traditional products) |
| 22nd Century Group Inc. (XXII) | Strong growth potential in reduced nicotine tobacco products and biotech advancements. | Bullish (due to innovation in reduced nicotine products and biotech) | Long-term (due to innovative product portfolio) |
| RLX Technology Inc. (RLX) | High growth in the U.S. vaping market, but facing regulatory hurdles. Expansion in new markets could drive future growth. | Bullish (for short-term, given growing U.S. market share) | Short-term (uncertainty surrounding regulatory actions in vaping) |
| Imperial Brands PLC (IMBBY) | Moderate growth with strong emphasis on tobacco alternatives, but faces declining market share in traditional tobacco. | Neutral to Bearish (due to struggling traditional tobacco sales and slow shift to alternatives) | Long-term (transitioning to alternatives but facing competitive challenges) |
Why These USA Tobacco Companies Are Good or Bad Investments :
Good Investment Factors:
- Altria Group Inc.: Strong position in the U.S. with diversified products like smokeless tobacco and nicotine pouches. Long-term growth potential in reduced-risk products.
- Philip Morris International: Focus on reduced-risk products like IQOS gives it strong growth prospects. Global presence offers expansion opportunities, particularly in emerging markets.
- British American Tobacco PLC: Diversification into vaping and non-tobacco products like Vuse positions it well for the future. Strong presence in global markets helps reduce dependence on traditional tobacco.
- Turning Point Brands Inc.: Niche markets in vaping and smokeless tobacco show growth, although the regulatory environment presents risks.
- 22nd Century Group Inc.: Innovative approach to tobacco with reduced nicotine cigarettes and biotech solutions. High potential in changing consumer preferences and regulatory support.
- RLX Technology Inc.: Growing dominance in the U.S. vaping market gives it strong short-term growth prospects, although regulatory uncertainty remains a concern.
Bad Investment Factors:
- Scandinavian Tobacco Group A/S: Heavy reliance on traditional cigars, with consumer shifts moving towards healthier alternatives. Short-term growth potential is limited due to changing preferences.
- Imperial Brands PLC: Struggling to transition from traditional tobacco to alternatives like e-cigarettes. Faces stiff competition and regulatory challenges, slowing its growth prospects.
I hope you like this article regarding full analysis of USA Tobacco companies.
Happy Investing
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