Altria Group Inc

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MO : NYSE : Consumer Goods
$63.50 -0.27 | -0.42%
Today's Range: 62.97 - 63.53
Avg. Daily Volume: 5,169,700
09/29/16 - 10:28 AM ET

Financial Analysis


ALTRIA GROUP INC's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. ALTRIA GROUP INC has very weak liquidity. Currently, the Quick Ratio is 0.17 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity decreased from the same period a year ago, despite already having very weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 12.99% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)4881.04875.0
EBITDA ($mil)2461.02279.0
EBIT ($mil)2412.02228.0
Net Income ($mil)1653.01448.0


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)819.01166.0
Total Assets ($mil)31324.031869.0
Total Debt ($mil)12837.013920.0
Equity ($mil)3140.02779.0


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin61.4859.84
EBITDA Margin50.4146.74
Operating Margin49.4245.7
Sales Turnover0.610.58
Return on Assets18.0215.99
Return on Equity179.77183.48
Debt Q2 FY16 Q2 FY15
Current Ratio0.830.74
Debt/Capital0.80.83
Interest Expense192.0195.0
Interest Coverage12.5611.43


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)1954.011961.97
Div / share0.570.52
EPS0.840.74
Book value / share1.611.42
Institutional Own % n/a n/a
Avg Daily Volume5652564.05951358.0

Valuation


BUY. This stock's P/E ratio indicates a premium compared to an average of 21.24 for the Tobacco industry and a discount compared to the S&P 500 average of 25.19. For additional comparison, its price-to-book ratio of 39.90 indicates a significant premium versus the S&P 500 average of 2.82 and a significant premium versus the industry average of 20.07. The current price-to-sales ratio is well above the S&P 500 average and above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, ALTRIA GROUP INC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
MO 22.26 Peers 21.24   MO 22.34 Peers 20.48

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

MO is trading at a valuation on par with its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

MO is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
MO 19.14 Peers 13.30   MO 1.51 Peers 5.02

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

MO is trading at a significant premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

MO trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
MO 39.90 Peers 20.07   MO 10.76 Peers 1.74

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

MO is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

MO is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
MO 6.55 Peers 6.24   MO 3.26 Peers -0.89

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

MO is trading at a valuation on par with its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

MO has a sales growth rate that significantly exceeds its peers.

 

 

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