Altria Group Inc (MO) - Get Report stock fell over 9% Friday following the FDA's decision to lower allowed levels of nicotine in cigarettes, but the dip in price isn't a buying opportunity, RBC analyst Nik Modi said, according to MarketWatch.

The FDA announced Friday plans to reduce the amount of nicotine in tobacco products in order to curb the number of tobacco-related deaths and illnesses in the U.S. Tobacco stocks were hit hard following the news, with Altria leading the plunge downward.

Modi upgraded Altria to "sector perform" from "underperform" Monday, keeping a $62 price target. Modi's price forecast implies about a 7% downside for the stock.

Regulatory price shocks like this one have created buying opportunities in the past 20 years, but Modi says this isn't one. Altria isn't a buyout candidate and its stock is only at a "fair" valuation with fundamentals under pressure following disappointing second quarter results.

Modi said RBC isn't "going to take a leap of faith" on Altria's smokeless IQOS cigarette product given limited visibility on regulatory issues, even for noncombustible smoking products.

Altria stock traded down 2.8% early Monday afternoon as the tobacco industry continued to take a hit. Philip Morris Int'l (PM) - Get Report and Vector Group Ltd (VGR) - Get Report both traded slightly down under 1%, with peer British America (BTI) - Get Report down almost 3%.

22nd Century Group (XXII) - Get Report continued gains, with its stock trading up over 14% Monday morning. The plant biotech company specializes in altering the amount of nicotine and nicotinic alkaloids in tobacco plants, positioning it to perform well in the wake of the FDA's decision.

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