Altria Group (NYSE:MO) is seeking Food and Drug Administration (FDA) approval for its new on! PLUS oral nicotine pouches. Altria’s subsidiary, Helix Innovations, submitted the application. The move aligns with Altria’s strategy to expand its smoke-free product offerings.
Altria is focusing on meeting consumers’ changing preferences via innovation in low-risk products. Nick MacPhee, Helix’s Managing Director, believes on! PLUS could become popular in the U.S. market and support the company’s growth.
Altria to Expand Smoke-Free Products
Altria plans to ramp up investments in promoting its smoke-free products. During the Q1 conference call, Altria’s management said they would spend more on marketplace activities for these products. The company is also investing in research and regulatory preparation for smoke-free products.
This strategy shows that Altria sees growth opportunities in authorized smoke-free products for adult tobacco consumers.
Is Altria a Buy, Sell, or Hold?
Altria is a solid stock for investors seeking dividend income. It is a Dividend Aristocrat (learn more about Dividend Aristocrats here) and offers a high yield of over 8%. Further, Altria returns a significant amount of cash to its shareholders through share buybacks.
Altria expects its EPS to grow at a CAGR of mid-single-digits through 2028. This would enable Altria to increase its dividends consistently in the coming years.
MO stock has three Buys, three Holds, and two Sell recommendations for a Hold consensus rating. Analysts’ average price target on MO stock is $43.17, implying a downside potential of 6.88% from current levels. Altria stock has gained over 20% year-to-date, beating the S&P 500’s (SPX) nearly 15% gain.
