|Bid||45.86 x 1000|
|Ask||45.75 x 2200|
|Day's Range||45.32 - 46.22|
|52 Week Range||39.30 - 57.88|
|Beta (5Y Monthly)||0.49|
|PE Ratio (TTM)||N/A|
|Earnings Date||Apr. 29, 2020|
|Forward Dividend & Yield||3.36 (7.44%)|
|Ex-Dividend Date||Dec. 23, 2019|
|1y Target Est||55.11|
(Bloomberg) -- Altria Group Inc. shares dipped Friday after a report in the Wall Street Journal that the U.S. Securities and Exchange Commission had opened a probe into the cigarette maker’s $12.8 billion investment into vaping company Juul Labs Inc.Shares of Altria closed Friday at $45.89 in New York, up 0.7% after gaining as much as 1.4% earlier in the day. The Journal said the SEC is probing whether Altria adequately disclosed the risks of the investment. The tobacco company has written its position down to $4.2 billion amid new restrictions on Juul’s business and scrutiny over whether the vaping company hooked a new generation of young users on nicotine. Judy Burns, an SEC spokeswoman, declined to comment. Representatives for Juul and and Altria declined to comment.Altria invested in Juul in late 2018, valuing the vaping startup at about $38 billion at the time. In announcing the most recent writedown, Altria said it had narrowed the terms of its cooperation with Juul, saying it would no longer give it marketing help and would instead focus solely on assisting Juul through its growing regulatory challenges.Juul can only keep selling its products in the U.S. if it submits an application to the Food and Drug Administration by May 12 -- and if the agency eventually approves it.Altria has been “highly disappointed” in its Juul investment, CEO Howard Willard said in January. When the tobacco giant first made its investment, “Juul was the market share leader and market growth leader” in vaping, he said.K.C. Crosthwaite, a former Altria executive who is now Juul’s CEO, has said that he is focused on building the e-cigarette maker for the long-term by preparing premarket tobacco product applications to earn authorization in the U.S. Juul’s latest internal valuation has put the company’s value at about $20 billion, according to an internal memo sent to staff and described to Bloomberg News.To contact the reporter on this story: Drew Armstrong in New York at firstname.lastname@example.orgTo contact the editor responsible for this story: Drew Armstrong at email@example.comFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Altria Presents at the Consumer Analyst Group of New York Conference; Reaffirms Full-year 2020 Earnings Guidance
E-cigarette maker Juul Labs Inc bought online advertisements on teen-focused websites for Nickelodeon, Cartoon Network and Seventeen magazine after it launched its product in 2015, according to a lawsuit filed on Wednesday by the Massachusetts attorney general's office. The allegations in the lawsuit, stemming from a more than year-long investigation, contradict repeated claims by Juul executives that the company never intentionally targeted teenagers, even as its products became enormously popular among high-school and middle-school students in recent years. The lawsuit filed by Massachusetts Attorney General Maura Healey said the company worked through online ad buyers to purchase space on websites that were "highly attractive to children, adolescents in middle school and high school, and underage college students," including educational websites such as coolmath-games.com and socialstudiesforkids.com.
Convertible notes are not just for early-stage startups any more. Convertible notes allow companies more time to develop their businesses before deciding who gets what. In recent months, however, more established companies that have already raised priced rounds have raised money via convertible notes.
Investing.com - Vaping company Juul Labs has raised a more funds for its operations at a time when the sector is getting hit hard by new regulations, The Wall Street Journal reported Thursday.
(Bloomberg Opinion) -- Megabrew is saying goodbye to one of its mega-champions.Anheuser-Busch InBev SA said late Wednesday that long-standing finance director Felipe Dutra would step down in April. It’s the second big management change at the brewer in as many years. Chairman Olivier Goudet exited last year and was replaced by Martin Barrington, the former chief executive officer of tobacco company Altria Group Inc., one of AB InBev’s biggest shareholders.AB InBev did not comment on why Dutra was leaving. CEO Carlos Brito said the departure was “bittersweet.” Dutra felt now was the right time to embark on new projects, he said, adding that his contribution was hard to overstate.Dutra has spent almost 30 years with the owner of the Budweiser, Leffe and Jupiler brands, so it’s not overly surprising he’s moving on. He has been one of the architects, alongside Brito, of AB InBev’s transformation from a Brazilian beer maker to the world’s biggest brewer. That includes the 2016 acquisition of SAB Miller, which saddled the company with more than $100 billion of net debt.AB InBev should seize the opportunity created by the transition to augment its cost-cutting prowess with a greater emphasis on sales growth. That’s as necessary as continuing to whittle away its borrowing burden.Since the creation of this megabrewer, AB InBev has been grappling with the high leverage as well as a lackluster performance, from a combination of continuing beer volume declines in the U.S., where premium and craft beers are all the rage, and difficult conditions in key emerging markets, including Brazil. Dutra has managed the debt as well as he could, with borrowings having an average maturity of 14 years, and 91% on fixed terms. He also halved the dividend in October 2018, raised gross proceeds of $5.75 billion from a listing of the company’s Asia Pacific unit last year and another $11.3 billion from selling the Australian arm.Consequently, Duncan Fox of Bloomberg Intelligence estimates net debt at the end of 2019 was at just over $90 billion, and expects it to fall to about $75 billion at the end of 2020. That’s clearly an improvement, and may be another reason for Dutra to depart now while things are looking better. But it remains high. Even at the later date, borrowings would still be about 3.3 times Ebitda, well above AB InBev’s long-term goal of two times.To really bring down leverage, AB InBev needs to lift profit, which is hardly forecast to move in 2019 and 2020, according to the Bloomberg consensus of analysts’ estimates.That begs for efforts not only to control costs, which Dutra excelled at, but to boost sales growth, especially from elevating the amount of beer sold, not just raising prices. This is particularly necessary in the North American beer market, which accounts for about 30% of sales and profit, where volumes must be stabilized.Indeed, the change of finance director needs to usher in a new era at AB InBev, where it achieves a better balance between its legendary cost management and spending to turbocharge its brands including the flagship Budweiser, faster-growing Michelob Ultra and its selection of carbonated alcoholic beverages known as hard seltzers. AB InBev appears to know this. Brito says new finance director Fernando Tennenbaum’s role will be to support top-line growth through both financial management and investment as well as continuing to bring down debt.The change of guard may signal further developments as well. First, large scale M&A, already unlikely given the borrowing burden, is probably off the agenda for now, as the new finance director settles in. And while Brito’s succession may be some way off, given the two recent changes at the top, the appointment of Tennenbaum, as well as David Almeida as chief strategy and technology officer, appears to set the backdrop for this process.Still, if there is one more thing that Megabrew excels at, it’s unleashing a mega-surprise on investors. To contact the author of this story: Andrea Felsted at firstname.lastname@example.orgTo contact the editor responsible for this story: Melissa Pozsgay at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- Cars and cigarettes have at least one thing in common these days: They are both being disrupted by more modern alternatives. So Stefan Bomhard, the chief executive officer of car dealer Inchcape Plc, should have some idea of what he’ll face when he takes the reins at U.K. cigarette maker Imperial Brands Plc.It isn’t easy to find executives willing to move to the much-aligned tobacco industry. But Bomhard looks a good CEO choice for Imperial, which sells Lambert & Butler cigarettes and Blu vapes. The company had decided to part ways with Alison Cooper in October, a week after a profit warning. She will now step down as with immediate effect.Bomhard did a solid job at Inchcape. While the shares are down about 18% since he became CEO in April 2015, underperforming the FTSE All-Share Index, conditions in car dealing haven’t been easy since Britain voted to leave the European Union and consumer confidence crumbled. It’s still a much better performance than the FTSE All-Share General Retailers Index.The downside is that Bomhard doesn’t have any tobacco experience. But this is less of an issue than it would be in, say, general retailing. Imperial will have plenty of executives with many years’ worth of knowledge of the traditional cigarette business, still the biggest and most profitable part of the group. And he should be able to pull on his prior experience with big global brands in the race to grab market share for Imperial’s new products, whatever they may be.The new chief executive spent his career in consumer goods before joining Inchcape, with roles at spirits company Bicardi, chocolate and candy maker Cadbury, and consumer-goods giant Unilever. That should put him in good stead as Imperial attempts to pivot to alternatives to traditional cigarettes, which could in turn, pave the way for it to diversify into dispensing other adult, highly regulated products, such as cannabis.When Bomhard takes up the role at a yet to be determined date, his first task will be to get to grips with the crisis in the U.S. vaping industry. The company is evaluating the impact of the recent Food and Drug Administration ban on flavors aside from menthol and tobacco for pod-based electronic cigarettes, the type it makes.Then Bomhard will have to work quickly to decide where best to focus Imperial’s attention, and investment. Although the group has strong positions in vaping and oral nicotine, it only entered the heat-not-burn market relatively recently. He must decide whether to expand in this category, which has not been drawn into the crisis in the U.S. vaping industry.He could also look at reshaping other aspects of Imperial’s business, including traditional cigarettes. The company is already seeking to raise up to 2 billion pounds ($2.6 billion) through disposals, including a sale of its premium cigar business. But he could go further, say selling off parts of the portfolio in Asia and Africa, and returning the proceeds to shareholders, or investing more in tobacco alternatives.Either way, Bomhard must take decisive action. Shares in Imperial have fallen more than 20% over the past year, and they trade at a 40% discount to Bloomberg Intelligence’s global tobacco manufacturing valuation peer group. The company even lags Altria Group Inc., which is reeling from its disastrous investment in vaping company Juul Labs Inc.Imperial has long been seen as an acquisition target, with Japan Tobacco Inc. tipped as the most obvious contender. Another possibility would be for Japan Tobacco and British American Tobacco Plc to carve up Imperial’s empire between them along geographical lines. So if Bomhard doesn’t light up the Imperial share price, a bigger rival just might.To contact the author of this story: Andrea Felsted at firstname.lastname@example.orgTo contact the editor responsible for this story: Melissa Pozsgay at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Altria Group, Inc. (NYSE:MO) shares fell 5.4% to US$47.53 in the week since its latest yearly results. Revenues came...
The decline weighed on the S&P communication services index , which lost 1.36%. Microsoft Corp gained 2.31% after it beat expectations for quarterly earnings, driven by Azure cloud computing revenue growth.
(Bloomberg Opinion) -- Altria Group Inc.’s investment in Juul Labs Inc. is getting vaporized.The tobacco giant on Thursday announced a $4.1 billion non-cash charge related to its stake in the maker of electronic cigarettes. It’s the second writedown in three months, and means Altria’s 35% stake is now valued at $4.2 billion, about a third of its original $12.8 billion investment. Altria shares more than 5% in midday trading.The Marlboro maker’s Juul transaction, in December 2018, was part of a familiar playbook across Big Tobacco. With demand for cigarettes declining, it had little choice but to join other market leaders in the industry in pivoting toward alternatives with potentially lower health risks, but higher growth prospects.For most players, there have been hurdles along the way. Two years ago, for example, demand for devices that heat rather than burn tobacco slowed in Japan — the biggest market for this kind of alternative — which was a problem for Philip Morris Intenational Inc. and the U.K.’s British American Tobacco Plc. Unfortunately, with Juul, Altria has encountered more challenges than most.A crisis has engulfed the vaping industry after a spate of illnesses and deaths related to electronic cigarette use. Even though there is a growing consensus that these occurrences involved vaping oils carrying the psychoactive ingredient in cannabis, the events have taken their toll on the U.S. vaping market.Juul has been at the forefront of criticism, besieged by lawsuits accusing it of using sweet fruit and candy flavors to overtly target underage users. The Food and Drug Administration recently announced a ban on flavors aside from menthol and tobacco for pod-based electronic cigarettes, such as those made by Juul, pending new rules coming into force in a few months time. Kenneth Shea, analyst at Bloomberg Intelligence, says Juul’s many challenges must include the possibility that the FDA doesn’t approve it to remain on the U.S market. All manufacturers must submit their applications to keep their products on sale by May.Along with the Juul writedown, Altria has moved to renegotiate the terms of its agreement with Juul. It has the option to be released from a non-compete clause if Juul can’t sell electronic cigarettes in the U.S. for at least a year – acknowledging the possibility that Juul won’t get FDA approval -- or if the value of its investment falls below $1.28 billion. This paves the way for Altria to introduce its own vaping cigarettes, or, more likely, according to Bloomberg Intelligence’s Shea, a move away from electronic cigarettes to heat-not-burn. Unlike electronic cigarettes, these haven’t been drawn into the vaping crisis. Altria has the license to distribute IQOS, Philip Morris’s heat-not-burn product, in the U.S. Given the long-term trend for declining smoking rates – Altria will no longer provide multi- year forecasts for U.S. cigarette declines -- all tobacco companies, must find alternatives to traditional cigarettes. At the time of its original investment, Juul was disrupting the industry, leaving Marlboro man trailing in its wake. By getting in on the act, it was hoping to future-proof its business.But Altria should have been more aware of the risks, particularly those related to underage vaping, which were plain to see, after Juul axed social media accounts and pulled some flavors. And it should have factored this into the price it paid. To be fair, it couldn’t have foreseen how the environment for electronic cigarettes in the U.S. would deteriorate so dramatically over the past six months.Altria’s new emphasis on heat-not-burn over vaping looks sensible, but it makes the Juul investment look a very expensive foray into a category it may end up moving away from. As Altria’s investment dollars go up in smoke, so do any hopes that its shift away from cigarettes will be quick or easy. To contact the author of this story: Andrea Felsted at firstname.lastname@example.orgTo contact the editor responsible for this story: Beth Williams at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- For Juul Labs Inc., the troubled king of vaping, the blows keep coming -- even from Marlboro country.Marlboro cigarette maker Altria Group Inc., which poured nearly $13 billion into the vaping startup in late 2018, valuing it at $38 billion, on Thursday said it had marked down its investment for a second time by $4.1 billion. That leaves the value of its 35% stake at just $4.2 billion -- or around a third of its initial worth.Altria also narrowed the terms of its cooperation with Juul, saying it would no longer give it marketing help and would instead focus solely on helping Juul steer through its growing regulatory challenges. Critically, Juul can only keep selling its products in the U.S. if it submits an application to the Food and Drug Administration by May 12 -- and if the agency eventually approves it. That process is what Altria and Juul will throw their remaining partnership behind.Juul is facing a growing number of lawsuits from state attorneys general, school districts and parents blaming the company’s popular vaporizers for hooking teens on nicotine. It has removed some of its best-selling products from the market as the U.S. regulators sought tough new curbs on flavored vaping products. And younger adults that once made Juul’s products a hit are being drawn to competing devices, such as disposable flavored vaping pens.Altria shares fell as much as 7.5% to $46.33 on Thursday. The stock traded at $47.40 at 12:05 p.m.Crucial ApprovalWinning FDA approval was already crucial for Juul, but the widening public blowback against vaping amid a rash of lung illnesses and the financial pressure created by Altria’s markdowns elevate the stakes. Altria said Thursday if regulators bar Juul from the market for at least a year, the tobacco giant will be free to sell its own competing products.“As we continue to reset the vapor category, we are committed to advancing the long-term potential for harm reduction for adult smokers while combating underage use,” Juul CEO K.C. Crosthwaite, a former Altria executive, said.He said he was focused on building the company for the long-term by preparing premarket tobacco product applications to earn authorization in the U.S. Juul’s latest internal valuation has put the company’s value at about $20 billion, according to an internal memo sent to staff and described to Bloomberg News.Altria said it recorded a total of $8.6 billion in charges to its Juul investment last year, mainly due to legal claims against the vaping company, bringing the stake’s value to $4.2 billion as of Dec. 31.Pivot PreludeThe writedown is another blow to Altria’s efforts to broaden its portfolio beyond cigarettes. It’s also banking on growth from IQOS, the heat-not-burn device it sells in the U.S., as part of a deal with Philip Morris International Inc. which sells it in dozens of countries overseas. IQOS is now sold in the Atlanta, Georgia and Richmond, Virginia markets.Altria’s core business in cigarettes remained strong and the company will invest further in heated tobacco and oral products, Chief Executive Officer Howard Willard said on a call discussing its latest earnings. He was pleased with the progress of Cronos, the cannabis company in which it also owns a stake.The Juul writedown is “a prelude to a pivot to prioritizing other noncombustible products,” such as the IQOS device, Bloomberg Intelligence analyst Kenneth Shea said in a note. Such a massive impairment charge “may raise concerns about CEO Howard Willard’s stewardship,” he said.‘Highly Disappointed’Altria has been “highly disappointed” in its Juul investment, Willard said. When Altria first made its investment, “Juul was the market share leader and market growth leader,” he said.Altria expects that the legal claims against Juul will continue, after increasing by more than 80% since Oct. 31. Many name Altria as a co-defendant. Chief Financial Officer Billy Gifford said on the call that Altria would seek to dismiss lawsuits where it is named with Juul.The company’s regulatory filings showed that Altria and Juul agreed not to pursue litigation against each other for a year after their agreement, and that in cases where both are co-defendants, Altria is limited from seeking reimbursements from Juul.Deal RevisedAltria made a number of other revisions to the pair’s cooperation. Juul will restructure its board once it gets antitrust clearance. It will include two directors designated by Altria, three independent directors, the Juul CEO and three directors designated by Juul stockholders other than Altria. The board will also add a nominating committee and a litigation oversight committee upon approval, according to Altria’s press release.Altria is still waiting for antitrust clearance from the U.S. Federal Trade Commission, which had been expected to let shares convert by January 8. Willard said today the delay was not a concern.Under the other revised terms of the cooperation accord, Altria’s non-compete option would be void if Juul can’t sell its products in the U.S. for at least a year, or if the value falls to less than 10% of its initial $12.8 billion investment.“There’s always a chance something like that could happen,” Willard said. Still, he told investors not to read too much into its new agreement with Juul and called the deal one that “added value for both sides.”To contact the reporters on this story: Tiffany Kary in New York at firstname.lastname@example.org;Angelica LaVito in New York at email@example.comTo contact the editors responsible for this story: Sally Bakewell at firstname.lastname@example.org, Timothy AnnettFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Altria's (MO) fourth-quarter 2019 results reflect gains from strong pricing. Revenues improve in the smokeless products unit but decline in the smokeable products unit.
Altria (MO) delivered earnings and revenue surprises of 0.99% and -1.94%, respectively, for the quarter ended December 2019. Do the numbers hold clues to what lies ahead for the stock?
The Marlboro maker in the United States said on Thursday the fourth-quarter charge was mainly due to the increased number of legal cases pending against Juul and the expectation that the number would continue to grow. Overall, Altria has recorded $8.6 billion in impairment charges after it took a 35% stake in Juul for $12.8 billion in December 2018. "I'm highly disappointed in the financial performance of the Juul investment," Altria Chief Executive Officer Howard Willard said on a post-earnings call.
Altria Reports 2019 Fourth-Quarter and Full-Year Results
Investing.com - Altria reported on Thursday fourth quarter earnings that matched analysts' forecasts and revenue that fell short of expectations.
Altria (MO) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.
Altria Group is showing signs of buyer's remorse when it comes to the 35 percent stake it bought in e-cigarette company Juul. Altria, the parent company of old-school cigarette brands like Marlboro, said Thursday that it will stop providing services including logistics, distribution and access to retail shelf space to Juul. A string of vaping-related deaths- though none connected to Juul- coupled with a growing number of government bans on e-cigarettes after a surge in teen vaping, has clouded what once was a very promising future for Juul and a new smoking category that was supposed to offset the decline in traditional cigarettes. Altria is watching the value of its investment go up in smoke. On Thursday, Altria announced a $4 billion write-down on its Juul investment in the fourth quarter mainly due to the growing number of legal cases facing the e-vaping company, that brings Altria's total write-down to nearly $9 billion. It only paid $12.8 billion for the Juul stake back in December 2018. With that in mind, Altria has now re-worked the terms of the deal - taking a step back to only help Juul with regulatory affairs including the submission of products for FDA approval. But Altria isn't optimistic about the future - on Thursday's earnings conference call, the CEO said he expected to see a continued slowdown or outright decline in the e-vaping category and said there was always the chance Juul could get pulled off the market by federal law. Juul's problems helped swing Altria from a fourth-quarter profit to a loss of nearly $2 billion. Shares of Altria were down in Thursday trade.