Morgan Stanley Upgrades Altria On Better Price
The cigarette business isn’t exactly smoking these days. And as investors have moved away from Big Tobacco, lowering share prices, one of the biggest cigarette companies has also broadened its product line beyond traditional cigarettes. And that makes the cheaper shares of Altria Group Inc. (NYSE: MO) worth a new look, Morgan Stanley said Friday in a note. Morgan Stanley’s Pamela Kaufman upgraded Altria from Underweight to Equal-weight with a $44 price target. Kaufman acknowledged things still don’t look great long-term for the tobacco industry. But investors have known that for some years, and Altria has underperformed the broader market considerably, with its shares down 5.7% year to date while the S&P 500 is up more than 16%. “We expect US cigarette volumes to remain under pressure ... but acknowledge that this has become part of the consensus view on the stock,” Kaufman wrote.