Gerald Pascarelli, an analyst from Needham, has initiated a new Buy rating on Philip Morris (PM).
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Gerald Pascarelli has given his Buy rating due to a combination of factors that highlight Philip Morris’s strategic positioning and growth potential. The company has made significant progress in its transition towards a smoke-free business model, with over 40% of its revenue and profits now stemming from this segment. This shift not only aligns with healthier consumer trends but also offers higher margins compared to traditional combustible products.
Moreover, Philip Morris has established itself as a leader in the heated tobacco and nicotine pouch markets, which are among the fastest-growing categories. The company’s ability to consistently achieve double-digit growth in its smoke-free markets, alongside improved performance in combustible products, has resulted in four consecutive years of positive volume growth. With its market leadership, focus on innovation, and opportunities in untapped geographic regions, Philip Morris is well-positioned to achieve strong revenue growth and maintain a sustainable high single-digit to low double-digit earnings growth trajectory.
Pascarelli covers the Consumer Defensive sector, focusing on stocks such as Celsius Holdings, Molson Coors, and Boston Beer. According to TipRanks, Pascarelli has an average return of -1.9% and a 45.83% success rate on recommended stocks.