PHILIP MORRIS INTERNATIONAL (PM) Stock Fundamental Analysis
NYSE:PM - New York Stock Exchange, Inc. - US7181721090 - Common Stock - Currency: USD
Taking everything into account, PM scores 5 out of 10 in our fundamental rating. PM was compared to 8 industry peers in the Tobacco industry. PM has an excellent profitability rating, but there are some minor concerns on its financial health. PM is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
PM had positive earnings in the past year.
PM had a positive operating cash flow in the past year.
In the past 5 years PM has always been profitable.
PM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 11.64%, PM belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
The Return On Invested Capital of PM (25.67%) is better than 87.50% of its industry peers.
PM had an Average Return On Invested Capital over the past 3 years of 25.07%. This is significantly above the industry average of 16.58%.
The last Return On Invested Capital (25.67%) for PM is above the 3 year average (25.07%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.64% | ||
| ROE | N/A | ||
| ROIC | 25.67% |
ROA(3y)12.65%
ROA(5y)15.58%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)25.07%
ROIC(5y)31.2%
1.3 Margins
PM's Profit Margin of 19.73% is fine compared to the rest of the industry. PM outperforms 75.00% of its industry peers.
PM's Profit Margin has declined in the last couple of years.
PM has a Operating Margin of 36.24%. This is amongst the best in the industry. PM outperforms 87.50% of its industry peers.
In the last couple of years the Operating Margin of PM has remained more or less at the same level.
With an excellent Gross Margin value of 65.68%, PM belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
In the last couple of years the Gross Margin of PM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.24% | ||
| PM (TTM) | 19.73% | ||
| GM | 65.68% |
OM growth 3Y-4.61%
OM growth 5Y-0.93%
PM growth 3Y-13.73%
PM growth 5Y-5.04%
GM growth 3Y-1.62%
GM growth 5Y0.03%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), PM is creating value.
Compared to 1 year ago, PM has about the same amount of shares outstanding.
Compared to 5 years ago, PM has about the same amount of shares outstanding.
Compared to 1 year ago, PM has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.06 indicates that PM is not in any danger for bankruptcy at the moment.
PM has a better Altman-Z score (4.06) than 75.00% of its industry peers.
PM has a debt to FCF ratio of 4.86. This is a neutral value as PM would need 4.86 years to pay back of all of its debts.
PM has a better Debt to FCF ratio (4.86) than 62.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 4.86 | ||
| Altman-Z | 4.06 |
ROIC/WACC3.12
WACC8.24%
2.3 Liquidity
A Current Ratio of 0.79 indicates that PM may have some problems paying its short term obligations.
PM's Current ratio of 0.79 is on the low side compared to the rest of the industry. PM is outperformed by 62.50% of its industry peers.
A Quick Ratio of 0.43 indicates that PM may have some problems paying its short term obligations.
PM has a worse Quick ratio (0.43) than 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.43 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 9.95% over the past year.
Measured over the past 5 years, PM shows a small growth in Earnings Per Share. The EPS has been growing by 4.72% on average per year.
Looking at the last year, PM shows a small growth in Revenue. The Revenue has grown by 6.78% in the last year.
The Revenue has been growing slightly by 4.91% on average over the past years.
EPS 1Y (TTM)9.95%
EPS 3Y2.57%
EPS 5Y4.72%
EPS Q2Q%12.67%
Revenue 1Y (TTM)6.78%
Revenue growth 3Y6.45%
Revenue growth 5Y4.91%
Sales Q2Q%5.78%
3.2 Future
Based on estimates for the next years, PM will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.38% on average per year.
PM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.64% yearly.
EPS Next Y17.51%
EPS Next 2Y14.26%
EPS Next 3Y12.8%
EPS Next 5Y10.38%
Revenue Next Year9.4%
Revenue Next 2Y8.85%
Revenue Next 3Y7.97%
Revenue Next 5Y7.64%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
PM is valuated quite expensively with a Price/Earnings ratio of 26.00.
Based on the Price/Earnings ratio, PM is valued a bit more expensive than 62.50% of the companies in the same industry.
PM is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 25.91, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 20.49, which indicates a rather expensive current valuation of PM.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PM is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of PM to the average of the S&P500 Index (21.85), we can say PM is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26 | ||
| Fwd PE | 20.49 |
4.2 Price Multiples
PM's Enterprise Value to EBITDA ratio is in line with the industry average.
PM's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. PM is more expensive than 62.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.75 | ||
| EV/EBITDA | 19.82 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of PM may justify a higher PE ratio.
PM's earnings are expected to grow with 12.80% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.48
PEG (5Y)5.5
EPS Next 2Y14.26%
EPS Next 3Y12.8%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.19%, PM has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 4.06, PM pays a bit more dividend than its industry peers.
PM's Dividend Yield is a higher than the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.19% |
5.2 History
The dividend of PM has a limited annual growth rate of 2.76%.
PM has been paying a dividend for at least 10 years, so it has a reliable track record.
PM has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)2.76%
Div Incr Years15
Div Non Decr Years15
5.3 Sustainability
PM pays out 109.27% of its income as dividend. This is not a sustainable payout ratio.
PM's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP109.27%
EPS Next 2Y14.26%
EPS Next 3Y12.8%
175.23
+0.59 (+0.34%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryTobacco
Earnings (Last)
Earnings (Next)
Inst Owners80.71%
Inst Owner Change1.75%
Ins Owners0.13%
Ins Owner Change3.46%
Market Cap272.75B
Analysts81.67
Price Target177.56 (1.33%)
Short Float %0.9%
Short Ratio2.06
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.19% |
Yearly Dividend5.28
Dividend Growth(5Y)2.76%
DP109.27%
Div Incr Years15
Div Non Decr Years15
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.08%
Min EPS beat(2)0.44%
Max EPS beat(2)1.72%
EPS beat(4)3
Avg EPS beat(4)0.59%
Min EPS beat(4)-1.59%
Max EPS beat(4)1.78%
EPS beat(8)6
Avg EPS beat(8)0.36%
EPS beat(12)9
Avg EPS beat(12)2.9%
EPS beat(16)10
Avg EPS beat(16)2.04%
Revenue beat(2)0
Avg Revenue beat(2)-0.58%
Min Revenue beat(2)-1.03%
Max Revenue beat(2)-0.13%
Revenue beat(4)1
Avg Revenue beat(4)-0.44%
Min Revenue beat(4)-1.03%
Max Revenue beat(4)0.11%
Revenue beat(8)3
Avg Revenue beat(8)-0.76%
Revenue beat(12)6
Avg Revenue beat(12)1.23%
Revenue beat(16)8
Avg Revenue beat(16)0.82%
PT rev (1m)16.66%
PT rev (3m)27.13%
EPS NQ rev (1m)3.58%
EPS NQ rev (3m)4.33%
EPS NY rev (1m)3.27%
EPS NY rev (3m)4.68%
Revenue NQ rev (1m)3.03%
Revenue NQ rev (3m)4.24%
Revenue NY rev (1m)2.68%
Revenue NY rev (3m)3.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26 | ||
| Fwd PE | 20.49 | ||
| P/S | 7.11 | ||
| P/FCF | 26.75 | ||
| P/OCF | 23.46 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 19.82 |
EPS(TTM)6.74
EY3.85%
EPS(NY)8.55
Fwd EY4.88%
FCF(TTM)6.55
FCFY3.74%
OCF(TTM)7.47
OCFY4.26%
SpS24.66
BVpS-7
TBVpS-25.13
PEG (NY)1.48
PEG (5Y)5.5
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.64% | ||
| ROE | N/A | ||
| ROCE | 37.61% | ||
| ROIC | 25.67% | ||
| ROICexc | 28.75% | ||
| ROICexgc | 121.16% | ||
| OM | 36.24% | ||
| PM (TTM) | 19.73% | ||
| GM | 65.68% | ||
| FCFM | 26.56% |
ROA(3y)12.65%
ROA(5y)15.58%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)25.07%
ROIC(5y)31.2%
ROICexc(3y)27.51%
ROICexc(5y)37.8%
ROICexgc(3y)111.48%
ROICexgc(5y)109.03%
ROCE(3y)35.09%
ROCE(5y)42.41%
ROICexcg growth 3Y8.03%
ROICexcg growth 5Y11.03%
ROICexc growth 3Y-18.85%
ROICexc growth 5Y-9.39%
OM growth 3Y-4.61%
OM growth 5Y-0.93%
PM growth 3Y-13.73%
PM growth 5Y-5.04%
GM growth 3Y-1.62%
GM growth 5Y0.03%
F-Score6
Asset Turnover0.59
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 4.86 | ||
| Debt/EBITDA | 2.73 | ||
| Cap/Depr | 75.32% | ||
| Cap/Sales | 3.73% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 73.52% | ||
| Profit Quality | 134.6% | ||
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.43 | ||
| Altman-Z | 4.06 |
F-Score6
WACC8.24%
ROIC/WACC3.12
Cap/Depr(3y)88.63%
Cap/Depr(5y)80.44%
Cap/Sales(3y)3.65%
Cap/Sales(5y)3.09%
Profit Quality(3y)120.71%
Profit Quality(5y)120.05%
High Growth Momentum
Growth
EPS 1Y (TTM)9.95%
EPS 3Y2.57%
EPS 5Y4.72%
EPS Q2Q%12.67%
EPS Next Y17.51%
EPS Next 2Y14.26%
EPS Next 3Y12.8%
EPS Next 5Y10.38%
Revenue 1Y (TTM)6.78%
Revenue growth 3Y6.45%
Revenue growth 5Y4.91%
Sales Q2Q%5.78%
Revenue Next Year9.4%
Revenue Next 2Y8.85%
Revenue Next 3Y7.97%
Revenue Next 5Y7.64%
EBIT growth 1Y1.8%
EBIT growth 3Y1.54%
EBIT growth 5Y3.93%
EBIT Next Year19.22%
EBIT Next 3Y11.82%
EBIT Next 5Y10.29%
FCF growth 1Y34.09%
FCF growth 3Y-1.34%
FCF growth 5Y3.12%
OCF growth 1Y33.17%
OCF growth 3Y0.69%
OCF growth 5Y3.9%