Why Altria Stock Was Sliding Today

Shares of Altria (NYSE:MO), the tobacco giant best known as the domestic maker of Marlboro cigarettes, were heading lower after its guidance for 2025 disappointed investors.

As a result, the stock was down 4.2% as of 10:01 a.m. ET.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. See the 10 stocks »

Image source: Getty Images.

Altria is still struggling to grow

Revenue in the quarter was flat at $5.97 billion, though excluding excise taxes, it was up 1.6% to $5.11 billion, which was ahead of estimates at $5.05 billion.

Cigarette sales continued to decline, with volumes falling 8.8% to 16.6 billion sticks in the quarter. Marlboro's market share also fell a percentage point to 41.3%.

Elsewhere, on!, its oral nicotine pouch that competes with Zyn, continued to experience strong growth to 43.9 million cans, though that wasn't enough to drive growth in the overall oral tobacco category. NJOY, its other major growth product, reported a 15% increase in consumer volume to 12.8 million, and a 22% increase in device shipment volume to 1.1 million units.

On the bottom line, adjusted earnings per share grew 9.3% to $1.29 as the company benefited from share buybacks. That essentially matched the analyst consensus at $1.28.

CEO Billy Gifford called 2024 a pivotal year for the company, adding, "Our companies' leading brands and talented teams enabled our core tobacco businesses to deliver solid income growth and margin expansion."

Guidance comes up short

The main reason Altria stock pulled back was its guidance came up short. Management said adjusted earnings per share would grow 2% to 5%, reaching $5.22 to $5.37, which compares to the analyst consensus of $5.35.

The company continues to face a wide range of challenges, including competition from vapes, illegal and legal, as well as regulations that threaten the tobacco industry.

Most investors hold this stock for the dividend, which is safe, offering a yield of nearly 8%. However, weak earnings growth could lead to falling profits, and that would jeopardize the company's ability to grow its dividend.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $320,756!*
• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $45,331!*
• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $527,508!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

Learn more »

*Stock Advisor returns as of January 27, 2025

Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.