5-Star Stocks Poised to Pop: Philip Morris International

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Based on the aggregated intelligence of 120,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, global tobacco giant Philip Morris International (NYSE: PM) has earned a coveted five-star ranking. Our data has shown that five-star stocks outperform the market by a significant margin; conversely, one-star stocks have woefully lagged the market average.

With that in mind, let's take a closer look at Philip Morris International's business, and see what CAPS investors are saying about the stock right now.

Philip Morris facts

Headquarters

New York, N.Y. (spun off from Altria, March 2008)

Market Cap

$85.9 billion

Industry

Cigarettes

Trailing-12-Month Revenue

$25.5 billion

Management

CEO Louis Camilleri
CFO Hermann Waldemer

Trailing-12-Month Return on Capital

30.4%

Dividend Yield

5.1%

Competitors

British American Tobacco (AMEX: BTI)
Reynolds American (NYSE: RAI)

CAPS members bullish on PM also bullish on:

Altria (NYSE: MO)
Bank of America (NYSE: BAC)

CAPS members bearish on PM also bearish on:

Starbucks (Nasdaq: SBUX)
Citigroup (Nasdaq: C)

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS.

Over on CAPS, some 97% of the 295 All-Star members who have rated Philip Morris believe the stock will outperform the S&P 500 going forward. These bulls include JPRutledge and ikkyu2, both of whom are ranked in the top 6% of our community.

Late last month, JPRutledge wrote that Philip Morris "is a solid dividend payer with impressive growth prospects for a large multinational. Additionally, I find its current valuation quite promising for sizable long term appreciation to compliment its EPS growth and seemingly guaranteed annual dividend expansion."

In a pitch from three days ago, ikkyu2 makes a more careful call, weighing the stock's pros and cons:

Cautiously back into this one. Global anti-tobacco efforts are a major long-term threat, and so is a 79% debt-to-equity ratio in this current low rate environment; but a 5.3% yield for a stock with these kinds of global growth opportunities presents a very attractive investment.

What do you think about Philip Morris, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 120,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Bank of America is a recommendation of the analysts at Motley Fool Income Investor. Starbucks is a selection of both  Inside Value and Stock Advisor. The Fool owns shares of Starbucks. The Fool's disclosure policy always gets a perfect score.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 08, 2008, at 2:11 PM, hldboo wrote:

    I am much annoyed by articles that rely on automatic spell-checking, instead of old-fashioned proofreading. The resulting errors are distracting. ( I assume JPRutledge meant "complement" rather than "compliment.")

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