Philip Morris Boosts Shareholder Value with $7B Buyback Program

Philip Morris (PM) announced a new share repurchase program of up to $7 billion shares. Following the announcement, shares of the cigarette and tobacco manufacturing company rose 1.3% on June 11 to close at $98.84.

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Philip Morris plans to repurchase between $5 billion and $7 billion worth of its shares over a three-year period. The program will likely begin after the company reports its Q2 results.

Furthermore, the company announced a quarterly dividend of $1.20 per share, payable on July 12, 2021.

Philip Morris CEO Jacek Olczak said, “Since our spin-off in March 2008, we have returned, on a cumulative basis, approximately $115 billion to our shareholders through dividends and share repurchases.”

Olczak further added, “Our announcements today are further testament to our steadfast commitment to generously reward our shareholders as we transform into a smoke-free company.” (See Philip Morris stock analysis on TipRanks)

Following the buyback announcement, Piper Sandler analyst Michael Lavery reiterated a Buy rating on the stock but increased the price target to $114 from $111. This implies 15.3% upside potential to current levels.

Consensus among analysts is a Strong Buy based on 7 Buys and 1 Hold. The Philip Morris average analyst price target of $109.75 implies 11% upside potential from current levels. Shares have gained 36.9% over the past year.

TipRanks’ Stock Investors tool shows that investors currently have a Very Positive stance on Philip Morris, with 8.8% of investors increasing their exposure to PM stock over the past 30 days.