If I told you you could buy a business that had a 5.4% dividend yield, was growing earnings 20% a year, buying back billions in stock for only 13 times earnings..you would???? I also promise not to use anymore smoking related adjective to describe results like “on fire”, “smoking”, “lights up” etc…
Phillip Morris International (PM) Reported today:
Highlights
* Diluted earnings per share of $1.01, up 23.2% from $0.82, including the items detailed on Schedule 7
* Adjusted diluted earnings per share of $0.93, up 19.2% from the 2007 pro-forma adjusted earnings per share of $0.78
* Reaffirms its forecast for 2008 adjusted full-year diluted earnings per share, projecting growth of approximately 19% to 21% to a range of $3.32 to $3.38 from a 2007 pro-forma adjusted base of $2.79
* Increased its regular quarterly dividend during the quarter to $0.54, up 17.4% from its inaugural regular quarterly dividend of $0.46
* Spent $2.4 billion to repurchase 44.8 million shares of its common stock in the quarter
* Completed its previously announced acquisition of Rothmans Inc.
Philip Morris International Inc. (PM) today announced diluted earnings per share of $1.01 in the third-quarter of 2008, up 23.2% from $0.82, including the items detailed on Schedule 7.
“Our excellent third-quarter results clearly underscore our ability to deliver against our financial targets despite anticipated currency headwinds and the current global economic turbulence,” said Louis Camilleri, Chairman and Chief Executive Officer.
“We continue to witness robust business momentum, demonstrated by a strong increase in organic volume and solid net revenue and income growth, all of which lead us to reaffirm our annual earnings guidance”.
Dividends and Share Repurchase Program
PMI increased its regular quarterly dividend during the third quarter of 2008 to $0.54, up 17.4% from its inaugural regular quarterly dividend of $0.46. The increased dividend represents an annualized rate of $2.16 per common share. PMI has a dividend policy that anticipates a payout ratio of approximately 65%.
During the third quarter, PMI spent $2.4 billion to repurchase 44.8 million shares of its common stock. Since May 2008, when PMI began its previously-announced $13 billion, two-year share repurchase program, the company has spent a total of $4.5 billion to repurchase 86.2 million shares.
2008 Full-Year Forecast
PMI reaffirms its forecast for adjusted diluted earnings per share, reflecting strong business momentum, to a range of $3.32 to $3.38 for the full-year 2008, representing a growth rate of approximately 19% to 21%, from a revised pro-forma adjusted base of $2.79 per share in 2007.
Shares have fallen during the current panic 25% to $40 a share and represent a stunning buying opportunity..stunning…
Analysts on average had forecast 89 cents, according to Reuters Estimates. Sales, excluding excise taxes, rose 17.5 percent to $7 billion, helped by price increases and the weaker dollar. Analysts were expecting $6.6 billion. The number of cigarettes the company shipped also rose 4 percent to 225.9 billion.
Disclosure (“none” means no position):Long PM
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