Altria Q2 Earnings Coming Up: What Should Investors Expect?

Things to Consider About Altria’s Upcoming Results

Altria’s second-quarter performance is likely to have been supported by continued pricing strength across its smokeable products business, despite an industry environment marked by declining cigarette volumes. Strong net price realization, disciplined revenue management and resilient demand for premium brands are likely to have helped offset lower shipment volumes. However, persistent macroeconomic pressures and consumer downtrading toward discount offerings might have remained a drag on overall volume and product mix.

The company’s oral tobacco business is likely to have remained a key area of support, driven by continued momentum in nicotine pouches. The nationwide rollout of on! PLUS, broader retail availability and sustained consumer interest in smoke-free alternatives are likely to have supported shipment growth during the quarter. However, heightened competition in the nicotine pouch category, along with higher promotional spending and product mix pressures, is likely to have weighed on segment margins. The Zacks Consensus Estimate indicates a decrease of 1.7% in the Oral Tobacco Products revenues.

The Smokeable Products segment is likely to have remained the primary contributor to quarterly performance. Cigarette shipment volumes are likely to have continued declining year over year, although the pace of decline might have remained more moderate amid reduced cross-category movement to illicit disposable e-vapor products. Strong pricing, stable premium brand performance and disciplined portfolio execution are likely to have supported revenues and earnings, partially offsetting the impact of volume softness and a value-seeking consumer environment. The Zacks Consensus Estimate implies an increase of 1% in the Smokeable Products revenues.

Earnings Whispers for MO Stock

Our proven model doesn’t conclusively predict an earnings beat for Altria this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.

Altria currently has a Zacks Rank #2 and an Earnings ESP of -1.34%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

Archer-Daniels-Midland Company ADM currently has an Earnings ESP of +11.52% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Archer-Daniels’ upcoming quarter’s EPS is pegged at $1.27, which implies a 36.6% rise year over year. The consensus estimate for ADM’s quarterly revenues is pinned at $22.38 billion, which calls for 5.7% growth from the figure reported in the prior-year quarter. ADM delivered a trailing four-quarter earnings surprise of 5.4%, on average.

Kimberly-Clark Corporation KMB currently has an Earnings ESP of +1.43% and a Zacks Rank of 3. The Zacks Consensus Estimate for Kimberly-Clark’s upcoming quarterly revenues is pegged at $4.23 billion. The figure implies a 1.7% increase from the prior-year quarter. 

The Zacks Consensus Estimate for Kimberly-Clark’s quarterly earnings per share is pegged at $2.00, indicating a 4.2% gain from the year-ago period figure. KMB delivered a trailing four-quarter earnings surprise of 19.1%, on average.

Monster Beverage Corporation MNST currently has an Earnings ESP of +2.61% and a Zacks Rank of 3. The consensus estimate for Monster Beverage’s quarterly revenues is pinned at $2.42 billion, which indicates 14.5% growth from the figure reported in the prior-year quarter. 

The Zacks Consensus Estimate for the upcoming quarter’s EPS is pegged at 59 cents, which implies a 13.5% increase year over year. MNST delivered a trailing four-quarter earnings surprise of 9.6%, on average.

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This article originally published on Zacks Investment Research (zacks.com).

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