Altria Group’s Resilience Amid Declining Cigarette Volumes: A Strategic Outlook

Analyst Bonnie Herzog from Goldman Sachs maintained a Buy rating on Altria Group (MO – Research Report) and keeping the price target at $61.00.

Bonnie Herzog’s rating is based on Altria Group’s ability to demonstrate resilience in a challenging market environment. Despite facing significant declines in cigarette volumes, the company managed to report a Q1 EPS growth of 6%, slightly surpassing expectations. This was achieved through robust pricing strategies and cost management, including the elimination of MSA legal fees.
Herzog acknowledges the risks associated with accelerating cigarette volume declines and the potential impact of economic pressures on consumer behavior. However, she remains optimistic about Altria’s strategic approach to maintaining profitability and investing in its business. The analysis suggests that Altria can sustain low single-digit growth in operating profit and EPS over the next decade, driven by its performance in both smokeable and oral tobacco segments.

According to TipRanks, Herzog is a 4-star analyst with an average return of 4.9% and a 60.00% success rate. Herzog covers the Consumer Defensive sector, focusing on stocks such as Altria Group, Coca-Cola, and Molson Coors.

In another report released yesterday, Bank of America Securities also maintained a Buy rating on the stock with a $63.00 price target.