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Tobacco Stocks Q3 Earnings Preview: The Big Four

PM reports Thursday, and RAI, LO and MO are up next week

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Philip Morris International (PM)

Philip Morris NYSE:PMPhilip Morris (PM) lights up the tobacco stocks earnings cavalcade when it reports results before the bell Thursday.

The company, which manufactures and sells cigarettes outside the U.S., is expected to report earnings of $1.45 per share. In the same quarter a year ago, Philip Morris earnings came to $1.32.

Year-to-date, PM shares are only slightly in the black, although investors have collected a dividend yield of 4.4% along the way. Earnings growth for PM over the past year has lagged other tobacco stocks, with growth of just 4.05% vs. an industry growth rate of 5.4%.

Given PM’s weakness for the past few months, I suspect the company will have to see a strong beat Thursday if shares are to finish the year in the black. And it’s hard to depend on PM’s ability to manage expectations, as quarterly earnings have missed in three of the past five quarters.

Article printed from InvestorPlace Media, http://investorplace.com/2013/10/tobacco-stocks-earnings-preview/.

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