Philip Morris International Tobacco Spinoff
Market Context & Analysis
Starting Price: $42.00Altria spins off Philip Morris International—pure international tobacco play without US litigation risk. Emerging markets tobacco consumption growing. PMI has Marlboro international rights. Demographic dividend in developing countries. Currency diversification.
Global financial crisis hitting. But tobacco consumption defensive. Emerging markets growing strongly. Currency volatility creating opportunities. Commodities bull market.
Anti-smoking regulations increasing in developed markets. Emerging markets less regulated. FDA gaining tobacco authority in US but PMI unaffected.
PMI has Marlboro brand internationally. Growing in Asia, Eastern Europe, Latin America. Lower litigation risk than US market. Pricing power in emerging markets strong. Premium brands gaining share.
Tobacco stocks unloved by many investors. International exposure valued. Defensive characteristics attractive during financial crisis. High dividend yield attracts income investors.
- Pure international play—no US litigation risk
- Emerging markets consumption growing
- Demographic dividend in developing countries
- Premium Marlboro brand internationally
- Pricing power in emerging markets
- Currency diversification benefits
- High dividend yield attractive