BofA raised the firm’s price target on Philip Morris (PM) to $175 from $163 and keeps a Buy rating on the shares. While noting that the stock’s PE multiple has rerated and is now closer to those of mega cap consumer peers such as Procter & Gamble (PG), Coca-Cola (KO) and Mondelez (MDLZ), BofA thinks this multiple is “warranted” given the strength of Philip Morris’ operations and its outlook, adding that it likes the company’s strategy to shift smokers to higher-margin, less-harmful alternatives.
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