{"id":35721,"date":"2023-07-14T14:02:24","date_gmt":"2023-07-14T18:02:24","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/pricing-gains-to-drive-philip-morris-q2\/"},"modified":"2023-07-14T14:02:26","modified_gmt":"2023-07-14T18:02:26","slug":"pricing-gains-to-drive-philip-morris-q2","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=35721","title":{"rendered":"Pricing Gains To Drive Philip Morris\u2019 Q2?"},"content":{"rendered":"<div>\n<p><strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PM\">Philip Morris (NYSE: PM)<\/strong> is scheduled to report its Q2 2023 results on Thursday, July 20. We expect PM stock to trade higher, with its revenue and earnings likely exceeding the street expectations. The company should continue to benefit from an uptick in heated tobacco units and better pricing. Furthermore, our forecast indicates that PM stock has some room for growth, as discussed below. Our interactive dashboard analysis of <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PM\/no-login-required\/gJXZdx7m\/Philip-Morris-PM-Earnings-Preview-PM-Stock-Likely-To-Trade-Higher-Due-To-Strong-FY-2023Q2-Results-With-Revenues-And-Earnings-Beating-Expectations?fromforbesandarticle=trefis230714\">Philip Morris Earnings Preview<\/strong> has additional details.<\/p>\n<p><strong>(1) Pricing gains to bolster top-line growth<\/strong><\/p>\n<ul>\n<li>Trefis estimates Philip Morris\u2019 Q2 2023 revenues to be around $8.7 billion, reflecting an 11% y-o-y rise and slightly above the $8.6 billion consensus estimate.<\/li>\n<li>Philip Morris sells its tobacco products in non-U.S. markets. Revenue is generated from the sale of cigarettes and its flagship smokeless tobacco offering \u2013 IQOS. It acquired Swedish Match, Scandinavia\u2019s largest snus (a moist smokeless tobacco product) manufacturer, in Q4 last year.<\/li>\n<li>The company is expected to see continued growth in heated tobacco units, a trend seen in the recent past.<\/li>\n<li>Looking at Q1 2023, the company reported net revenue of $8.0 billion, marking a 3.5% rise over the prior-year quarter.<\/li>\n<li>The sales growth was driven by a 10% rise in heated tobacco units shipment volume and a 7% rise in combustible tobacco pricing. However, cigarette volume was down 3%.<\/li>\n<li>Our dashboard on <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PM\/no-login-required\/mwN2lmJX\/Philip-Morris-Revenues-How-Does-PM-Make-Money-?fromforbesandarticle=trefis230714\">Philip Morris Revenues<\/strong><strong> <\/strong>has more details on the company\u2019s segments.<\/li>\n<\/ul>\n<p>(<strong>2) EPS likely to be slightly above the consensus estimates<\/strong><\/p>\n<ul>\n<li>Philip Morris\u2019 Q2 2023 adjusted earnings per share is expected to be $1.50 per Trefis analysis, slightly above the consensus estimate of $1.47.<\/li>\n<li>The company\u2019s adjusted EPS of $1.38 in Q1 2023 was down 4.4% from $1.58 in the prior-year quarter.<\/li>\n<li>The company\u2019s adjusted operating margin contracted 630 bps during the quarter due to higher inflationary pressure on SG&amp;A. Our <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PM\/no-login-required\/cTlkrUXa\/Philip-Morris-PM-Operating-Income-Comparison?fromforbesandarticle=trefis230714\">Philip Morris Operating Income Comparison<\/strong> dashboard has more details.<\/li>\n<li>For the full-year 2023, we expect the adjusted EPS to be higher at $6.28 compared to $5.98 in 2022.<\/li>\n<\/ul>\n<p><strong>(3) PM stock looks like it has some room for growth<\/strong><\/p>\n<ul>\n<li>We estimate <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PM\/no-login-required\/gc3pUJ2B\/Philip-Morris-PM-Valuation-Is-PM-Stock-Expensive-Or-Cheap-?fromforbesandarticle=trefis230714\">Philip Morris\u2019 Valuation<\/strong><strong> <\/strong>to be around $107 per share, 10% above the current market price of $98.<\/li>\n<li>This represents a 17x P\/E multiple based on a forward EPS estimate of $6.28, compared to the last three-year average of 15x. Given the expected strong growth in the heated tobacco business and from the integration with Swedish Match, we have assigned a slightly higher multiple than the historical average.<\/li>\n<li>If the company reports upbeat Q2 results and provides the 2023 outlook better than the street estimates, the P\/E multiple will likely be revised upward, resulting in higher levels for PM stock.<\/li>\n<\/ul>\n<p><fbs-ad position=\"inread\" progressive=\"\" ad-id=\"article-0-inread\" aria-hidden=\"true\" role=\"presentation\"><\/fbs-ad><\/p>\n<p>While PM stock seems to have some room for growth, it is helpful to see how <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PM\/topic\/peer-comparisons\">Philip Morris\u2019 Peers<\/strong> fare on metrics that matter. You will find other valuable comparisons for companies across industries at <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/topic\/peer-comparisons\">Peer Comparisons<\/strong><strong>.<\/strong><\/p>\n<p>Furthermore, the Covid-19 crisis has created many pricing discontinuities which can offer attractive trading opportunities. For example, you\u2019ll be surprised at how counter-intuitive the stock valuation is for<strong> <\/strong><strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PM\/no-login-required\/AZyyBoyr\/Philip-Morris-vs-Entergy-PM-stock-s-significantly-higher-valuation-vs-ETR-appears-counterintuitive?fromforbesandarticle=trefis230714\">Philip Morris vs. Entergy<\/strong><fbs-ticker data-name=\"ETR\" data-href=\"https:\/\/www.forbes.com\/companies\/entergy\" data-type=\"stock\"><br \/>\n  ETR<br \/>\n <\/fbs-ticker>.<\/p>\n<p>What if you\u2019re looking for a portfolio that aims for long-term growth? Here\u2019s a value portfolio that\u2019s done much better than the market since 2016.<\/p>\n<p>Invest with <strong>Trefis <\/strong><strong data-ga-track=\"ExternalLink:https:\/\/dashboards.trefis.com\/data\/companies\/PORTFOLIOS\/no-login-required\/M7MacZNG?fromforbes\">Market Beating Portfolios<\/strong><\/p>\n<p>See all <strong>Trefis <\/strong><strong data-ga-track=\"ExternalLink:https:\/\/dashboards.trefis.com\/data\/price-estimates?fromforbes\">Price Estimates<\/strong><\/p>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.forbes.com\/sites\/greatspeculations\/2023\/07\/14\/pricing-gains-to-drive-philip-morris-q2\/\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Philip Morris (NYSE: PM) is scheduled to report its Q2 2023 results on Thursday, July 20. We expect PM stock to trade higher, with its revenue and earnings likely exceeding the street expectations. The company should continue to benefit from an uptick in heated tobacco units and better pricing. Furthermore, our forecast indicates that PM [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":35722,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-35721","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-markets","tag-featured"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Pricing Gains To Drive Philip Morris\u2019 Q2? | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Philip Morris (NYSE: PM) is scheduled to report its Q2 2023 results on Thursday, July 20. 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