Philip Morris International (
is one of the most controversial companies we cover.
I understand not everyone likesinvesting in cigarette
manufacturers, and that's fine...
But our job at StreetAuthority is to give you the most timely
and profitableinvestment advice available.
In short... our job is to help you makemoney .
And in doing so, we wouldn't be doing our job if we neglected to
tell you that although it may be controversial,
Philip Morris is also the most shareholder-friendly company
In just four years, the company has raised itsdividend 85% and
bought back 467 millionshares ofstock . During that time, shares
have returned roughly 100%.
Here's how Philip Morris returns value to shareholders on a
First, the company buys back its own stock month after month --
no matter what themarket is doing. It's bought back a staggering
22% of its shares in the past four years.
There's no doubt that's a major reason this "boring" cigarette
company has been doubling investors' money.
Philip Morris is one of the exceedingly rare companies that
consistently grows its dividend year after year.
Since the company paid its first dividend of 50 cents per share
in June 2008, it has raised its dividend every single year.
Take a look at the chart of Philip Morris' dividend growth to
And I expect this rapid dividend growth to continue for years to
Since spinning off from
in 2008, Philip Morris has quickly amassed a $4.8 billion "Dividend
refers to the enormous stockpile of money a company uses to pay
dividends to shareholders.
With billions of dollars sitting in its "Dividend Vault," Philip
Morris should have no trouble paying a steady, growing dividend
well into the future.
Looking forward, despite its size and industry dominance, Philip
Morris still has plenty of room to grow.
Remember, Philip Morris is a spin off of Altria's cigarette
business. But there's a big difference between the two
While Altria continues to sell its brands, including Marlboro
and Merit, in the United States... that business is slowly
Philip Morris, on the other hand, focuses outside the United
States. And in the international markets, it's a very different
Overseas marketsoffer greater growth opportunities in the
cigarette industry because of their growing populations and looser
restrictions on tobacco marketing. Therewill be an estimated 1.4
billion smokers globally by 2020, up from 1.3 billion today --
that's an additional 100 million potential customers, many of whom
will choose a Philip Morris brand.
In fact, Philip Morris sells its products in 180 countries and
owns seven of the world's top 15 brands.
Philip Morris is exactly what I look for in a
shareholder-friendly business. It buys back shares, consistently
raises dividends, owns an enormous "Dividend Vault" and has
tremendous growth potential.
It's a rare thing whenever you find a company that possesses all
of these traits. But when you do, you don't want to pass it up.
Risks to Consider:
Of course, there's no quality a company can possess that
willguarantee its success. But when you can find companies like
Philip Morris that dominate their market and are returning billions
to investors, these are the sort ofstocks that can deliver strong
returns in nearly any market -- including this one.
Action to Take -->
I recommend buying the stock up to $85 a share with aprice target
of $115 a share.
Philip Morris is just one of 13 stocks I've discovered with an
enormous "Dividend Vault." Right now, U.S. companies own a
"Dividend Vault" worth more than $1.7 trillion. To learn more,
including the name andticker symbols of some of my favorite
"Dividend Vault" stocks,
-- Paul Tracy
Paul Tracy owns shares of PM.StreetAuthority LLC owns shares of
PM in one or more of its "real money" portfolios.
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