Philip Morris, the tobacco firm, expects to continue to pay dividends

Despite certain unfavorable macroeconomic circumstances, Philip Morris International Inc. (PM) was able to beat analysts’ forecasts in the first quarter of this year. Philip Morris’ net sales grew 2.1 percent to $7.7 billion, while organic growth slowed to 9%. This discrepancy is due to the company’s decision to discontinue selling items in some areas. At the same time, the company’s sales topped Wall Street analysts’ expectations.

Philip Morris’ adjusted diluted profits for the most recent quarter were $1.56 per share, down 0.6 percent year over year but still greater than Wall Street projections. Experts are generally optimistic about Philip Morris’s future, and they predict that the company will grow each diluted share by about 4% each year for the next five years.

The next generation of tobacco products will play a significant role in the revenue structure. Philip Morris is expected to become the leading manufacturer of tobacco-free goods by 2025. “Smokeless” items accounted for 30.4 percent of the company’s sales during the quarter. Shipments of cigarettes and heated tobacco products (such as IQOS) increased by 4.9 percent to 155.3 billion units in the first quarter.

Despite the fact that the payout ratio is expected to be 90.1 percent in 2022, Philip Morris is a reliable dividend payer. Dividend coverage could improve significantly if Philip Morris International rebounds from a decline in adjusted diluted earnings per share. As a result, the shares are expected to pay out typical single-digit yearly dividends in the following years. With Philip Morris International’s strong dividend yield of 4.7%, this could be a great way to make money and grow your wealth at the same time.