Summary
For 2018, Philip Morris expects adjusted EPS to grow 8-10%, and Altria Group expects its adjusted EPS to grow 16-19%.
Altria Group has a Debt/EV Ratio of 0.11x, which is far superior to Philip Morris' 0.21x ratio.
Based on consensus Wall Street averages, 15% upside is expected for Philip Morris, and 9% upside is expected for Altria Group.
It would be hard to find two better dividend stocks than Philip Morris (PM) or Altria Group (MO). The good news is that both have suffered recent price declines and are now at what I consider good buying opportunities. With that being said, I prefer Altria Group for the following reasons:
- Altria Group has been the more consistent performer over the last 5 years and expects to increase adjusted EPS by 16-19% this year.
- Altria Group's balance sheet is far less leveraged than Philip Morris' which provides more investment and acquisition opportunities in the future.
- Altria Group trades at similar valuation multiples to Philip Morris, but a higher growth rate yields a more attractive PEG Ratio of 1.49x.
