The stock price of Altria (MO) is down over 27% this year.
This has clearly been a painful year for equity holders of this once-stable
company. But continuing declines in smoking rates in the United States has
sparked fears that there is no way Altria can continue its earnings growth over
the long run.
The big drop in Altria’s stock price is the bad news, at
least for current holders of the stock. But there is a lot of good news for
those looking to invest in solid dividend-paying stocks: First and foremost,
Altria’s current dividend yield is 5.9%.
It isn’t easy to find a 5.9% dividend yield from a company
with a long history of never cutting its dividend. Also, Altria increased its
dividend this year by 14% compared to 2017. For those looking for dividend income
over the long-run, Altria could be the perfect fit.
How Altria Can Continue To Grow
The decline in U.S. smoking is definitely bad news for this
company. But Altria understands they need to diversify and they have been
making moves. They recently bought a $1.8 billion stake in Canadian marijuana
company Cronos. Altria knows that the tide has turned for legalized marijuana
both here in the U.S. and Canada, and they want to get on board early.
No comments:
Post a Comment