Consumer Staples

Report by TobaccoIntelligence

Some Big Tobacco have recently delivered their Q1 results. PMI continues reporting its smoke-free momentum, announcing 25% organic growth in net revenues and 38% in gross profit - with strong contributions from Iqos and Zyn. On the other hand, oral tobacco continues to make a significant contribution to Altria’s numbers, as the company reported its results for the first quarter of 2024 with encouraging earnings from its On! nicotine pouch brand.

Consumer Staples

Report by TobaccoIntelligence

MO will launch a heated tobacco capsule called Swic and a new addition to its existing nicotine pouch brand, On! Plus. The tobacco giant said that both products are in development. It has yet to file premarket tobacco product applications (PMTAs) with the US FDA. MO is also considering including cannabis and caffeine pouches in its offering of non-nicotine products as part of its growth strategy.

Consumer Staples

Report by Behind the Numbers

MO's appeal is its 8.2% yield. However, smoking income is essentially equal to the dividend. The company is already missing forecasts, and smoking income tailwinds are about to become headwinds as volume decay is already accelerating. BTN does not see much cushion for the dividend going forward. Not for the first time the tobacco giant finds itself on BTN's Quarterly Focus List - companies they believe have a higher risk of reporting an earnings disappointment based on their analysis of earnings quality. MO's EQ score is 2- (Weak).