Altria Group (NYSE:MO), parent of Philip Morris USA and majority owner of Kraft Foods (NYSE:KFT), reported a drop in second-quarter revenues and earnings today. The news notwithstanding, there were positive trends in the quarter, including increased U.S. retail market share for its cigarette brands and strong international growth. It also remains an attractive stock, thanks to its hefty dividend yield.
Revenues declined 1.3% to $20.8 billion. Altria sold a chunk of its Miller Brewing division last summer, so it's lacking the $1.4 billion in beer sales that Miller contributed last Q2. The company earned $2.44 billion ($1.20 a share, including $0.06 in charges) in the quarter, below the $2.61 billion ($1.21 a share) it took in during the year-ago period.
Domestic tobacco revenues and operating income were snuffed out by heavy competition from cheaper cigarettes and increased promotional spending. Still, Philip Morris USA's stable of brands claimed more market share during the period, increasing to 48.5% sequentially from the first quarter's 48.3% and the fourth quarter's 48.1%. Shipment volume also improved, growing 4.1% to 48.2 billion.
Internationally, Altria's tobacco business returned operating income growth of 14.3%. A weak dollar, higher prices abroad, and increased demand helped generate Philip Morris International's solid results and $1.6 billion in income.
For investors, Altria's lure is its fat dividend yield. The company's stock price is often volatile because of the ever-present legal uncertainties, but its yield is a yummy 6.4%. That's income worth enduring some stock shimmies for.
Want to learn more about Altria and other high-dividend-yielding companies? Read the following three-part series from Mathew Emmert: A Six-Pack of Stocks , Where to Put Your Money Now , and Stocks That Pay . Tom Jacobs' Dividends Plus Growth is also a goodie, as is Jeff Fischer's Earn More, Keep More .
