24/7 Insights
- Based on Altria Group Inc.’s (NYSE: MO) financials, its generous payout is rock solid.
- Plus, the tobacco stock has gained about the same as the S&P 500 this year.
Altria Group Inc. (NYSE: MO), the tobacco company, pays a dividend that produces an 8.1% yield. Based on the public corporation’s financials, the payout is rock solid. And if the yield is not enough, Altria shares are up 19% this year, the same as the S&P 500.
Altria stock’s attractiveness has been acknowledged several times this year. Recently, Investor Place added it to a list of attractive holdings. It was included among “3 Undervalued Blue-Chip Stocks to Buy at a P/E of Less Than 10.”
Altria has raised its dividend for 54 years in a row. Its payout ratio is over 80%, which means 80% of the company’s earnings go to shareholders.
Altria left its guidance intact when it announced its most recent quarterly earnings. “We reaffirm our 2024 full-year adjusted diluted EPS guidance range of $5.05 to $5.17, representing a growth rate of 2% to 4.5% from a base of $4.95 in 2023.”
In that quarter, revenue slipped 2% year over year to $5.6 billion. Net income surged 19% to $2.1 billion, and 88% of that total came from cigarette sales. Altria also had $3.6 billion of cash and cash equivalents on its balance sheet, and the current portion of its long-term debt was zero.
There is a theory that Altria keeps a high dividend to get people to invest in a tobacco company. This is an issue each investor will need to decide individually.
Be sure to grab a copy of our “2 Dividend Legends to Hold Forever” report if you are looking for more great stock ideas.
Is Your Money Earning the Best Possible Rate? (Sponsor)
Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.
However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.
There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
