Tobacco products provider Philip Morris (NYSE:PM) aims to derive more than two-thirds of its total net revenue from smoke-free products by 2030. The company also provided growth outlook and business strategies at its 2023 investor day in Lausanne, Switzerland.
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PM has set a compound annual growth target of 6% to 8% for net revenues and 9% to 11% for adjusted EPS between 2024 and 2026. The company is aiming for heated tobacco unit shipment volume in the range of 180 billion to 200 billion units in 2026. It is targeting a nicotine pouch shipment volume of 800 million to 1 billion cans in 2026.
PM is banking on IQOS and ZYN, its two smoke-free brands. It expects ZYN to drive compound annual growth in net revenue and adjusted operating income in the double digits for its U.S. operations between 2024 to 2026.
For the full year 2023, PM expects EPS to be in the range of $5.19 and $5.28. For the third quarter, it anticipates EPS to be at the lower end of the $1.60 to $1.65 range.
What Is the Future of PM Stock?
Overall, the Street has a consensus price target of $115.83 on Philip Morris, alongside a Strong Buy consensus rating. This points to a 28.2% potential upside in the stock.
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