Has Altria Stock Been Good For Investors?

• Altria has underperformed the S&P 500 successful caller years.

• The banal remains a dividend powerhouse with a output supra 7%.

• Its aboriginal is tied to next-gen products similar Njoy and On!

• 10 stocks we similar amended than Altria Group ›

Tobacco stocks similar Altria (NYSE: MO) were historically immoderate of the champion stocks connected the market. Altria, which was joined with Philip Morris International for astir of its history, delivered an yearly mean instrumentality of 20% for 50 years with dividends reinvested, acknowledgment to a high-margin, addictive product, and its committedness to increasing its dividend.

More recently, however, the banal has struggled arsenic cigaret income successful the U.S. proceed to decline, and its attempts to pivot to next-gen products person faced aggregate setbacks.

Looking backmost implicit one-year, three-year, and five-year clip frames, the baccy banal has not outperformed the S&P 500 on a terms appreciation basis. However, implicit the past twelvemonth and implicit a five-year clip frame, it has beaten the broad-market scale connected a total-return basis. The charts beneath amusement however Altria compares with the S&P implicit those periods.

As you tin spot implicit a longer play of time, Altria's banal show against the S&P 500 has been modest, but it's inactive delivered a coagulated show acknowledgment to its dividend. During that time, the institution saw its $12.8 cardinal concern successful Juul fundamentally stroke up arsenic regulators killed Juul's business, and its concern successful cannabis grower Cronos Group also went south.

Most investors ain Altria for its dividends. The institution has historically paid a precocious dividend yield, and it has a past of raising its dividend each year. In fact, Altria has raised its dividend 60 times successful the past 56 years, and it present offers a dividend output of 7.2%. For dividend investors, it's hard to bushed that operation of output and reliable growth.

Looking ahead, portion cigaret income person continued to decline, the institution is hoping to thrust profits higher with a operation of terms hikes connected cigarettes and caller products, including Njoy, a vaporizer marque it acquired aft Juul failed, and On!, its oral nicotine pouch that's a rival to Philip Morris's Zyn.

Altria present trades astatine a debased price-to-earnings ratio of 11.3, and its currency travel instrumentality continues to look reliable. If it tin get immoderate maturation retired of products similar On! and Njoy, the banal should present terms gains successful summation to a beardown dividend for investors.