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Philip Morris International (PM) is drawing attention after recent share price gains, with the stock up over the past week, month, past 3 months, and year. You may be wondering what is driving that strength.
See our latest analysis for Philip Morris International.
That recent strength, with a 30-day share price return of 4.61% and a 90-day share price return of 18.64%, sits on top of a 1-year total shareholder return of 24.57% and a very large 5-year total shareholder return of 176.19%. This pattern suggests sentiment has been improving over time, even after short term pullbacks such as the 0.36% decline in the latest trading day.
If this has you thinking beyond a single stock, it could be a good moment to broaden your search with our screener of 19 top founder-led companies and see what else stands out.
With Philip Morris International trading at US$186.83 and a price target of US$194.09, along with an estimated intrinsic value gap of about 12%, the key question is whether there is still a buying opportunity here or if the market is already pricing in future growth.
Philip Morris International’s most followed narrative puts fair value at about $180.38, a little below the latest close at $186.83, which frames the current enthusiasm in context.
Analysts have lowered their price target on Philip Morris International from about $183 to about $180. The adjustment reflects slightly revised assumptions regarding fair value, discount rate, revenue growth, profit margin and future P/E, after incorporating recent research including the Jefferies downgrade.
Curious what kind of revenue path, margin profile and future earnings multiple still support that valuation even after the downgrade? The narrative leans on specific growth, profitability and discount rate assumptions that may surprise you once you see them set out in full.
Result: Fair Value of $180.38 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, there is still the risk that tighter regulation or slower smoke free product uptake could challenge those underlying growth and margin assumptions.
Find out about the key risks to this Philip Morris International narrative.
The narrative based on fair value of $180.38 paints Philip Morris International as slightly overvalued, but our DCF model points in the other direction. On that view, the shares at $186.83 sit about 12.4% below an estimated future cash flow value of $213.28. Which version of “fair” do you find more convincing?
