Morgan Stanley Hightlights PMI as Attractive Investment

Industry Insight by 2FIRSTS.ai
Jul.17.2023
Morgan Stanley Hightlights PMI as Attractive Investment
Morgan Stanley believes Philip Morris International is a top pick in the food and tobacco sectors, with an attractive risk-reward profile and potential for growth.

Morgan Stanley, has labeled Philip Morris International (PM) as a top pick in both the food and tobacco sectors. Analyst Pamela Kaufman has identified an attractive 4:1 risk-reward profile on the stock, suggesting that the recent pullback has created an enticing entry point for investors. 

 

One of the key reasons provided by Morgan Stanley to buy shares of Philip Morris International is the accelerating adoption of IQOS, a popular tobacco product, supported by the ILUMA rollout. Additionally, the Rapid Zyn growth in the U.S. presents an opportunity for international expansion. 

 

The company is also believed to have an appealing chance to penetrate the U.S. market for IQOS, while keeping investment spending under control. In terms of valuation, Philip Morris International is considered attractive compared to its peers in the Staples sector. The company's improving business mix, strong pricing power, U.S. expansion opportunity, and promising growth profile are factors that contribute to its appeal. 

 

Currently, PM is trading at a 14.5x NTM P/E ratio, which is 14% below its 10-year average of 16.8x. Furthermore, the stock is trading at a 37% discount compared to peers, a significant difference when compared to the average 20% discount observed over the past decade. PM is also available at a 26% discount to the S&P 500, unlike the usual 2% discount. On the balance sheet, Philip Morris International is expected to resume share buybacks and increase its dividend annually by 3%, providing additional incentives for investors. 

 

Morgan Stanley has given Philip Morris International a Buy rating, along with a price target of $118. This indicates the firm's confidence in the stock's potential to generate favorable returns. In the premarket session, shares of Philip Morris International were trading flat at $96.80. This is within the 52-week range of $82.85 to $105.62.

 

Reference:

 

 


Disclaimer

This article is provided solely for professional research, industry discussion, and informational purposes. Any references to brands, companies, products, technologies, or policies are made for factual reporting and analytical purposes only, and do not constitute endorsement, recommendation, promotion, or advertising by 2Firsts.

Nicotine-containing products, including but not limited to cigarettes, e-cigarettes, heated tobacco products, and nicotine pouches, carry significant health risks. Readers are responsible for complying with all applicable laws and regulations in their respective jurisdictions, including age restrictions and access limitations.

The information contained in this article should not be regarded as investment, legal, medical, regulatory, or commercial advice. While 2Firsts strives to ensure the accuracy and reliability of its content, it does not assume liability for any direct or indirect loss arising from errors, omissions, inaccuracies, or reliance on the information contained herein.

This article is not intended for individuals below the legal age for accessing tobacco or nicotine-related information in their jurisdiction.

 

Copyright Notice

This article is either original content produced by 2Firsts or content reproduced, translated, summarized, or adapted from third-party sources with attribution where applicable. The intellectual property rights of the original content remain with 2Firsts or the respective original rights holders.

No individual or organization may copy, reproduce, distribute, republish, modify, translate, or otherwise use this content without prior authorization. Any unauthorized use may result in legal action.

For copyright-related inquiries, corrections, or removal requests, please contact: info@2firsts.com.

 

AI-Assisted Translation and Editing Notice

Portions of this article may have been translated, edited, or reviewed with the assistance of artificial intelligence tools to improve efficiency and readability. Due to the limitations of AI-assisted translation and editing, discrepancies, omissions, or inaccuracies may exist when compared with the original source.

Where applicable, readers are advised to refer to the original source for the most complete and accurate information. If you identify any errors or believe that any content infringes upon your rights, please contact us at info@2firsts.com, and we will review and address the matter promptly.

Product | PMJ Adds Bold Ruby to IQOS ILUMA i Lineup in Japan, Convenience-Store Rollout Starts Sept. 29
Product | PMJ Adds Bold Ruby to IQOS ILUMA i Lineup in Japan, Convenience-Store Rollout Starts Sept. 29
Philip Morris Japan (PMJ) launched Bold Ruby as a new regular color for the IQOS ILUMA i and IQOS ILUMA i ONE in Japan on September 16, 2026, priced at JPY 6,980 and JPY 3,980, respectively. Initial sales began through IQOS online and physical channels, with convenience stores and selected tobacco retailers set to follow from September 29. Bold Ruby is a regular rather than limited-edition colorway and is available for the ILUMA i and ILUMA i ONE, but not the ILUMA i PRIME. The release does not involve changes to the devices' core hardware or functions.
Sep.22
PMI Global R&D Chief Meets Chinese Tobacco Regulator as China Advances Heated Cigarette Standards
PMI Global R&D Chief Meets Chinese Tobacco Regulator as China Advances Heated Cigarette Standards
Philip Morris International’s global R&D chief Michele Cattoni met Liu Sanjiang, deputy director of China’s State Tobacco Monopoly Administration, in Beijing on Aug. 27. The meeting comes as China advances mandatory standards for heated cigarettes and nicotine pouches, laying groundwork for their domestic introduction. Cattoni has held senior roles in PMI’s heated tobacco development, while China’s draft standard covers multiple heating architectures, including systems similar in principle to PMI’s IQOS ILUMA technology.
Aug.27
IVG Parent Secures HMRC Excise Warehouse and Duty Stamp Approvals Ahead of UK Vape Tax
IVG Parent Secures HMRC Excise Warehouse and Duty Stamp Approvals Ahead of UK Vape Tax
Acme Vape Ltd, the company behind UK vaping brand IVG, has received HM Revenue & Customs approval to operate an excise warehouse for vaping products and participate in the Vaping Duty Stamps Scheme. The UK's Vaping Products Duty will take effect on October 1, 2026, at a flat rate of £2.20 per 10ml of vaping liquid. Acme Vape Ltd says its approved warehouse in Preston will become operational under the new regime on the same date.
Regulations
Sep.18 by 2Firsts Perspectives
Australia Brings in Deloitte to Support Illicit Tobacco and Vape Enforcement Across Data, Processes and Project Delivery
Australia Brings in Deloitte to Support Illicit Tobacco and Vape Enforcement Across Data, Processes and Project Delivery
Australia’s Department of Home Affairs has hired Deloitte to provide data analytics, business-process, communications and project-delivery support to the Office of the Illicit Tobacco and E-Cigarette Commissioner. The government says Deloitte personnel do not provide policy advice to the Commissioner or the Australian government, with policy development and decision-making remaining with public officials. The arrangement has nevertheless drawn scrutiny because Deloitte has previously provided professional services to several tobacco and vaping companies.
Sep.03
Cochrane 2026 Update Adds Nine Trials, Keeps High-Certainty Finding That Nicotine E-Cigarettes Improve Quit Rates Over NRT
Cochrane 2026 Update Adds Nine Trials, Keeps High-Certainty Finding That Nicotine E-Cigarettes Improve Quit Rates Over NRT
Cochrane’s 2026 update of its living review on electronic cigarettes for smoking cessation included 80 randomized controlled trials involving 29,861 adult smokers, with nine trials added in this update. The review retained its high-certainty conclusion that nicotine e-cigarettes increase smoking cessation rates compared with nicotine replacement therapy. In absolute terms, about 10 in 100 people using nicotine e-cigarettes may quit smoking for at least six months, compared with about 6 in 100 using NRT. The review found no clear difference in serious adverse event rates between the two groups, while longer-term safety and the relative effectiveness of newer device types remain less certain.
Sep.07
Reuters Tracks Big Tobacco’s Shift Beyond Cigarettes as Nicotine Pouches Vie for the Next Growth Curve
Reuters Tracks Big Tobacco’s Shift Beyond Cigarettes as Nicotine Pouches Vie for the Next Growth Curve
As cigarette markets face long-term pressure, major tobacco companies are increasingly turning to nicotine pouches in search of growth beyond combustible tobacco. Reuters has examined whether nicotine pouches can become the next strategic growth platform for companies including Philip Morris International, British American Tobacco and Japan Tobacco. PMI strengthened its position through the acquisition of Swedish Match and its ZYN brand, while BAT and JTI continue expanding their own nicotine pouch portfolios. The category has gained attention because of its smoke-free, device-free format, but regulation, youth-use concerns and market scale will determine whether it can become a long-term growth engine.
Regulations
Aug.18 by 2Firsts Perspectives