The tobacco industry.
THE GLOBAL CIGARETTE INDUSTRY
To these types of products (if it is correctexactly what to call it), include: alcoholic beverages, sugary soft drinks, coffee, pharmaceuticals (for example: sedatives) and a number of certain food products. I mean exactly what is addictive and brings, to some extent, both satisfaction and harm ...
This is a category of goods with inelastic demand.
The business model of some of these companies (such as the Altria Group) can be very resilient even in times of severe storms.
1. Bring results;
2. Run out quickly;
3. Required again.
Not bad ... Can be compared to toilet paper, toothpaste, diapers, toothpicks, earpicks, napkins ...
This is one of those categories of goods that people buy practically regardless of the state of the economy.
Altria Group, Inc.
Altria Group, Inc. (formerly known as PhilipMorrisCompanies, Inc... ) Is an American corporation and one of the world's largest manufacturers and sellers of tobacco, cigarettes and related products.
Altria Reports 2020 Second Quarter and First-Half Results; Reestablishes 2020 Full-Year Earnings Guidance; Announces IQOS Expansion Plans; Board Declares Dividend Increase
Altria's wholly-owned subsidiaries include PhilipMorris USA Inc. (PM USA), U.S. Smokeless Tobacco Company LLC (USSTC), John Middleton Co. (Middleton), Sherman Group Holdings, LLC and its subsidiaries (Nat Sherman), Ste. Michelle Wine Estates Ltd. (Ste. Michelle) and Philip Morris Capital Corporation (PMCC). Altria owns an 80% interest in Helix Innovations LLC (Helix). Altria holds equity investments in Anheuser-Busch InBev SA / NV (ABI), JUUL Labs, Inc. (JUUL) and Cronos Group Inc. (Cronos).
The brand portfolios of Altria's tobacco operating companies include Marlboro®, Black & Mild®, Copenhagen®,Skoal® andon!® ... Ste. Michelle produces and markets premium wines sold under various labels, including Chateau Ste. Michelle®, 14 Hands®and Stag's Leap Wine Cellars™, and it imports and markets Antinori®, Champagne Nicolas Feuillatte™ and Villa Maria Estate™products in the United States. Trademarks and service marks related to Altria referenced in this release are the property of Altria or its subsidiaries or are used with permission.
M&A is best described by Peter Drucker:
“I'll tell you a secret: making deals is better than just working. Making deals is fun and enjoyable, and work is dusty. Leading something - first of all, doing a lot of hard and painstaking work ... making deals is romantic, sexy. That is why so many completely meaningless deals are being made. "
The company informs:
“The volume of supplies of cigarettes in the domestic market decreased by 1.9%, mainly due to losses in retail trade, the rate of decline in the industry and other factors ...”.
It's worth noting that Altria is highly inflation-adjusted.
The company is able to raise prices for its products, with little or no damage.
An important fact is the localization of the company.
When it comes to reducing cigarette use,it is necessary to take into account the fact that this increases the use of nicotine-containing products through: electronic cigarettes (vapes), IQOS and a number of non-smoking mixtures.
December 20, 2018 Altria completed the acquisition of 35% of shares JUUL Labs, an e-cigarette company based in San Francisco, California, for $ 12.8 billion.
Juul Labs, Inc.
Altria Group's proposed dividend yield,taking into account the almost zero yield on US Treasury securities (https://www.bloomberg.com/markets/rates-bonds/government-bonds/us), looks very attractive. Especially considering the company's dividend history.
I find it difficult to comment on this.
I have said more than once: the issue of real profitability is very acute now ...
As of July 31, 2020, excluding the increase in dividends.
This dividend increase marks the 55th dividend increase in 51 years, said Sal Mancuso, Altria's chief financial officer.
Common Equity Dividends
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