Morningstar Rating

Stock Research and Analysis

by Philip Gorham, CFA, FRM

Bulls Say

With 28% global market share (excluding the U.S. and China), PMI is the largest publicly traded tobacco company in the world. This unmatched scale, customer loyalty to Marlboro, and its addictive products give the firm meaningful pricing power.
PMI owns the international rights to Marlboro, the iconic global cigarette brand, and the strength of its product portfolio makes the firm the price leader in many international markets.
There is a long-term trend of trading up in emerging markets, and Philip Morris is the best-placed of the international manufacturers to benefit. Read more 

Bears Say

Plain packaging legislation is one of the few legitimate regulatory threats to Philip Morris' wide economic moat.
With its revenue derived in foreign currencies and about one quarter of its input costs in dollars, a strengthening of the U.S. dollar can have a material impact on earnings growth.
Although Marlboro is the only truly global cigarette brand, differences in tastes and preferences across geographies limit the economies of scale the firm can derive from the brand. Read more 

Management

Our stewardship rating of Philip Morris is Standard. Since its separation from Altria, Philip Morris has delivered total returns in the top half of its peer group, driven by top decile share repurchases and dividend growth in the consumer universe.   Read more 

Profile

Philip Morris International is the world's second-largest tobacco company, behind China National Tobacco, and holds 28% of the global market, excluding China. The firm owns   Read more 

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