Analysts Cool on Tobacco Stock After JUUL Deal

Altria Group has received a round of bearish analyst attention

by Patrick Martin

Published on Dec 21, 2018 at 9:29 AM

The shares of Altria Group Inc (NYSE:MO) are down 3.1% in early trading at $48.89, after Citigroup downgraded the stock to "sell" from "neutral," while trimming its price target $45 from $47. In addition, Independent Research downgraded MO to "sell" from "hold" and slashed its price target to $47 from $59, and Stifel chimed in with a price target hike of its own, to $59 from $70. Stifel said that Altria will "struggle to earn a sufficient return" on its investment in JUUL, citing what it saw as a "rich" evaluation.

As such, MO stock is trading at fresh three-year lows for a second straight day, and is on track for its third straight weekly loss. During this time frame, the shares have faced pressure from their descending 20-day moving average. Overall, MO has shed 19% in the past three months.

Despite the recent flurry of bear notes, analyst sentiment remains bullish. Of the 15 brokerages covering MO, 11 rate it a "buy" or "strong buy," with four "sells" on the books. Further, the security's consensus 12-month price target of $62.55 is a 24% premium to yesterday's closing perch of $50.44, suggesting today's onslaught of bear notes could be far from the last. 

In addition, short sellers have been skeptical to jump aboard. Shorts in fact have been hitting the exits, with short interest down 15% in the last two reporting periods. However, the 21.28 million shares sold short is the lowest amount since mid-July 2018, and represents a meager 1.1% of MO's total available float.  


A Schaeffer's exclusive

TOP STOCK PICKS 2020

Access your FREE insider report before it's too late!


 
 

Partnercenter


NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

MORE | MARKETstories


Former Hedge Fund Manager Makes $25,000 "Trading Breakthrough"
Click to continue to advertiser's site.
Dow Cools as Coronavirus Outbreak Takes Grasp of Markets
The Nasdaq is about to snap a six-week win streak
Copper Stock Picks Up Bear Notes After Earnings
FCX gapped lower yesterday after earnings
Former Hedge Fund Manager Makes $25,000 "Trading Breakthrough"
Click to continue to advertiser's site.