Goldman Sachs Reiterates Buy Rating on Philip Morris (PM) Into Q1 Results

Goldman Sachs analyst Bonnie Herzog reiterated a Buy rating and $120.00 price target on Philip Morris (NYSE: PM) into Q1 results on 04/20/23.

The analyst commented, "We reiterate our bullish call on PM heading into Q1 results on 4/20. Although PM's Q1 earnings are expected to be soft given a challenging comparison, higher expected investments and slow user acquisition given the timing of the ILUMA rollout, we see a potential upside surprise as we view mgmt's guidance as conservative. As such, we see a favorable risk/reward especially considering investors' low expectations. We maintain our conservative Q1 EPS estimate of $1.32, at the high end of mgmt's guidance range of $1.28-$1.33. Overall, we continue to see a compelling set-up for the stock given iQOS' powerful positive mix effect on PM’s overall business and PM’s resilient and hugely cash-generative combustible cig business. We believe PM's earnings visibility and momentum will continue to build throughout the year with upside potential from a broader & more aggressive global rollout of ILUMA, an accelerated RRP innovation pipeline, and increased penetration of iQOS/accelerated user acquisition in lower-income markets driven by further price segmentation. Also, we believe PM's Investor Day in September will be a positive catalyst for the stock. We maintain our EPS estimates and our $120 price target. PM remains one of our top stock picks."

For an analyst ratings summary and ratings history on Philip Morris click here. For more ratings news on Philip Morris click here.

Shares of Philip Morris closed at $98.79 yesterday.

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