Analyst Bonnie Herzog from Goldman Sachs maintained a Buy rating on Altria Group (MO – Research Report) and keeping the price target at $57.00.
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Bonnie Herzog has given her Buy rating due to a combination of factors influencing Altria Group’s strategic positioning. The company is leveraging its profitable smokeable products to support its long-term shift towards non-combustible alternatives. This includes the development of products like on! and NJOY, which are part of Altria’s broader harm reduction strategy. Despite challenges from the illicit e-vapor market and regulatory delays, the management remains confident in balancing earnings growth with shareholder returns while advancing their smoke-free initiatives.
Additionally, Altria’s core tobacco business provides substantial cash flow, exceeding $1 billion annually after dividends, which is used to fund share buybacks and fuel growth in smoke-free products. The company is also investing in potential growth drivers, including newer innovations in heated tobacco and non-nicotine products. With a focus on maintaining a stable and profitable business model, Altria aims to continue growing its earnings per share and returning significant cash to shareholders. This comprehensive approach and management’s confidence in their strategic direction underpin Herzog’s optimistic Buy rating for Altria Group.
According to TipRanks, Herzog is a 4-star analyst with an average return of 4.7% and a 57.00% success rate. Herzog covers the Consumer Defensive sector, focusing on stocks such as Altria Group, Coca-Cola, and Molson Coors.