Five tobacco stocks to explore in Q3: PM, VGR, UVV, MO & BTI

The tobacco industry comprises companies specializing in growing, producing, and selling tobacco and related products like cigarettes, e-cigarettes, etc.

Although social groups often criticize the industry, it has witnessed incredible growth over the past decades, helped by its addictive, profitable, and recession-proof products. Moreover, tobacco companies generally provide generous dividends to investors. Here we list five top tobacco stocks worth exploring in Q3.

Philip Morris International Inc (NYSE: PM)

Philip Morris International is one of the leading tobacco global firms, mostly recognized for one of its best-selling products, Marlboro. The company is based in New York.

Its shares traded at US$90.04 at 12:16 pm ET on July 15, up 0.47% from their closing price of July 14. Its stock value decreased by 6.38% YTD.

The firm has a market cap of US$139.54 billion, a P/E ratio of 15.59, and a forward one-year P/E ratio of 16.35. Its current yield is 5.52%, and its annualized dividend is US$5.00.

The 52-week highest and lowest stock prices were US$112.48 and US$85.64, respectively. Its trading volume was 5,867,449 on July 14.

The company reported a revenue of US$7.74 billion in Q1, FY22, representing an increase of 2.1% YoY. Its attributable net earnings came in at US$2.33 billion, or US$1.50 per diluted share, against an income of US$2.41 billion, or US$1.55 per diluted share, in Q1, FY21.

Source: Pixabay

Altria Group, Inc. (NYSE: MO)

Altria Group is one of the largest producers of tobacco, cigarettes, and other related products. It is based in Richmond, Virginia.

The stock traded at US$41.79 at 12:20 pm ET on July 15, up 0.38% from its previous closing price. The MO stock fell 13.22% YTD.

Its market cap is US$75.67 billion, the P/E ratio is 25.45, and the forward one-year P/E ratio is 8.62. Its current yield is 8.58%, and its annualized dividend is US$3.60.

The stock touched the highest price of US$57.05 and the lowest price of US$41.00 in the last 52 weeks. Its share volume on July 14 was 8,661,721.

The company's net revenue was US$5.89 billion in Q1, FY22, compared to US$6.03 billion in the year-ago quarter. Its attributable net earnings came in at US$1.95 billion, or US$1.08 per diluted share, against an income of US$1.42 billion, or US$0.77 per diluted share, in Q1, FY21.

Vector Group Ltd. (NYSE: VGR)

Vector Group is a tobacco company. It manufactures and sells cigarettes in the US through its subsidiaries. The firm is based in Miami, Florida.

Its shares traded at US$9.94 at 12:22 pm ET on July 15, down 0.40% from their closing price of July 14. Its stock value declined by 12.08% YTD.

The firm has a market cap of US$1.54 billion, a P/E ratio of 6.94, and a forward one-year P/E ratio of 8.76. Its current yield is 7.98%, and its annualized dividend is US$0.80.

The 52-week highest and lowest stock prices were US$17.39 and US$9.78, respectively. Its trading volume was 545,233 on July 14.

The company's revenue increased by 15.1% YoY to US$312 million in Q1, FY22. Its attributable net income came in at US$32.5 million, or US$0.21 per diluted share, versus US$32.0 million, or US$0.20 per diluted share, in Q1, FY21.

Universal Corporation (NYSE: UVV)

Universal Corporation is a leading tobacco leaf supplier based in Richmond, Virginia.

The stock traded at US$53.99 at 12:24 pm ET on July 15, up 0.69% from its previous closing price. The UVV stock tumbled 4.49% YTD.

The market cap of the company is US$1.32 billion, and the P/E ratio is 15.51. Its current yield is 5.91%, and its annualized dividend is US$3.16.

The stock touched the highest price of US$64.13 and the lowest price of US$46.24 in the last 52 weeks. Its share volume on July 14 was 100,223.

The company's sales and other operating revenue soared 6% YoY to US$2.10 billion for the fiscal year ended March 31, 2022. Its net income was US$86.6 million, or US$3.47 per diluted share, against an income of US$87.4 million, or US$3.53 per diluted share, for the year ended on March 31, 2021.

British American Tobacco PLC (NYSE: BTI)

British American Tobacco company is a leading cigarette manufacturer based in London.

Its shares traded at US$41.00 at 1:13 pm ET on July 15, down 2.96% from their closing price of July 14. Its stock value increased by 4.87% YTD.

The firm has a market cap of US$92.49 billion, and a forward one-year P/E ratio of 8.77. Its current yield is 7.3%, and its annualized dividend is US$2.942.

The 52-week highest and lowest stock prices were US$47.23 and US$33.62, respectively. Its trading volume was 3,410,555 on July 14.

The company's revenue was £25.68 billion (US$30.5 billion) for the year ended December 31, 2021, compared to £25.77 billion (US$30.6 billion) in the year-ago quarter. Its net income was £6.80 billion (US$8.09 billion), against an income of £6.40 billion (US$7.6 billion) for the year ended on December 31, 2020.

Bottom line:

The tobacco companies face several challenges, including the drop in smoking rates globally due to health concerns and tougher regulations. The industry is exploring new products, like e-cigarettes and vaporizers, to stay competitive. However, given the volatility in the market, investors should exercise due diligence before investing in the stock market. The Dow Jones US Tobacco Index fell 8.06% YTD.