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NEW YORK (
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+. Among the primary strengths of the company is its expanding profit margins over time. At the same time, however, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and weak operating cash flow.
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Highlights from the ratings report include:
- PHILIP MORRIS INTERNATIONAL' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, PHILIP MORRIS INTERNATIONAL increased its bottom line by earning $5.18 versus $4.84 in the prior year. This year, the market expects an improvement in earnings ($5.48 versus $5.18).
- The gross profit margin for PHILIP MORRIS INTERNATIONAL is rather high; currently it is at 68.35%. Regardless of PM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PM's net profit margin of 26.82% compares favorably to the industry average.
- PM, with its decline in revenue, slightly underperformed the industry average of 5.9%. Since the same quarter one year prior, revenues slightly dropped by 2.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- In its most recent trading session, PM has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
- The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Tobacco industry average. The net income has decreased by 8.3% when compared to the same quarter one year ago, dropping from $2,317.00 million to $2,124.00 million.
Philip Morris International Inc., through its subsidiaries, manufactures and sells cigarettes and other tobacco products. Philip Morris International has a market cap of $144.9 billion and is part of the consumer goods sector and tobacco industry. Shares are up 6.7% year to date as of the close of trading on Monday.
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--Written by a member of TheStreet Ratings Staff.