Never miss an important update on your stock portfolio and cut through the noise. Over 7 million investors trust Simply Wall St to stay informed where it matters for FREE.
Philip Morris International (PM) shares are back in focus after the company reported fourth quarter and full year 2025 results, shifting from a prior year loss to a profit and spotlighting smoke free products.
See our latest analysis for Philip Morris International.
The earnings rebound and focus on smoke free products have come alongside a strong share price run, with a 30 day share price return of 9.6% and a 1 year total shareholder return of 29.03%. This suggests positive momentum that is also visible in the 3 year and 5 year total shareholder returns of 111.40% and 179.50% respectively, despite a 0.76% share price pullback on the latest trading day to US$187.51.
If this kind of long term compounding has your attention, it could be a good moment to broaden your search and check out our screener of 23 top founder-led companies.
Given the recent profit rebound, the smoke-free growth story, and a share price sitting close to analyst targets yet still screening at around a 12% intrinsic discount, is there still a buying opportunity here, or is the market already pricing in the future?
Philip Morris International’s widely followed fair value estimate of about $180.38 sits a little below the last close at $187.51, which is a useful reference point for how the market is currently treating the stock.
Scale advantages, a broadening product portfolio, and an expanding IP moat in reduced-risk products are driving margin expansion. Smoke-free margins already surpass combustibles by over 4.5 percentage points, and as the mix continues to shift, this is expected to further increase overall net margins and free cash flow.
Curious what sits behind that confidence in higher margins and cash flows, even with slower growth assumptions baked in and a lower future earnings multiple? The narrative leans heavily on specific revenue trajectories, profitability targets, and a discount rate that together still point to a premium earnings profile. If you want to see exactly how those moving parts add up to a fair value around $180 per share, the full breakdown is worth a closer look.
Result: Fair Value of $180.38 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, there are still pressure points, including potential new taxes on products like ZYN and the ongoing structural decline in cigarette volumes, that could challenge this upbeat fair value story.
