Jefferies initiates Philip Morris stock with Buy rating, $220 price target
Investing.com
Published Jul 09, 2025 01:30AM ET
Investing.com - Jefferies initiated coverage on Philip Morris (NYSE:PM) with a Buy rating and a price target of $220.00 on Wednesday. The stock, which has delivered an impressive 50% return year-to-date, currently trades near its 52-week high of $186.69. According to InvestingPro analysis, the stock appears to be trading above its Fair Value.
The research firm expressed confidence in Philip Morris's leadership position in the heated tobacco and oral nicotine pouch segments, which it believes will drive sustainable high single-digit EBIT expansion in the medium term. The company maintains strong financial health with an overall "GOOD" rating from InvestingPro , supported by impressive gross profit margins of 65.7%.
Jefferies noted that while Philip Morris trades at a premium compared to other tobacco companies, its shares do not appear expensive when measured against Food and Household Personal Care blue chip stocks.
The firm highlighted that Philip Morris offers superior top-line and bottom-line growth prospects compared to these peer groups.
Jefferies also pointed to Philip Morris's elevated shareholder cash returns as another positive factor supporting its Buy recommendation.
In other recent news, Philip Morris International has reaffirmed its 2025 profit forecast, projecting diluted earnings per share (EPS) between $7.01 and $7.14. This forecast reflects a currency-neutral growth of 10.5% to 12.5% compared to the previous year's adjusted EPS. BofA Securities has raised its price target for Philip Morris stock to $200, maintaining a Buy rating, following positive remarks from the company's CFO about its smoke-free product strategy. Meanwhile, Stifel reiterated its Buy rating with a price target of $186, emphasizing the importance of European growth for the company's smoke-free products. UBS analysts have maintained a Neutral rating with a $170 price target, noting anticipated improvements in the U.S. market for ZYN nicotine pouches. Philip Morris continues to expand its smoke-free brands, including IQOS, ZYN, and VEEV, across various countries, aiming for significant sales contributions from these products. The company also projects a positive impact on earnings per share growth due to favorable foreign exchange conditions. Lastly, the FDA and U.S. Customs and Border Protection seized nearly $34 million worth of illegal e-cigarettes, highlighting ongoing regulatory efforts to curb unauthorized tobacco products.
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