Altria Company: An Analysis
Introduction
Through its subsidiaries in the U.S as well as globally, Altria group, Inc., is involved with the sale and manufacture of a variety of products including but not limited to a wide range of tobacco products, wine, cigarettes etc. In this text, I look at how the top leaders of the company m,manage their business. I also analyze the stocks of the Altria group and the prospects for the future market.
The Altria Group
Some of the most popular cigarette brands of the Altria group include parliament brands, Virginia slims, Marlboro. This company also has other smokeless tobacco products in its stable including Red seal, Skoal as well as Copenhagen. In transportation, the company is big in direct as well as leveraged finance leases. Altria’s management is charged with the duty of the establishment as well as maintenance of sufficient internal control systems. To gauge the effectiveness of management, the return on Altria’s assets according to the latest company financials stand at 10.89 while its return on equity stands at 88.05%. thus it can be said that the top leaders of the Altria group are effective in the management o9f the business. Concerning the stock of the company, in 2005, it was worth $66.83. this was an incredible raise from just above $24 dollars ten years earlier. The average return of the Altria stock has been impressive over time and analysts see sustained growth going forward (Thomsett 2007).
With regard to the future market of the Altria group, analysts see good times ahead for the company. The Altria group has over time offered superior returns to to its owners or shareholders over time. According to Thomsett (2007) when the S&P index came about, the group had a stable yield of about 20% per annum from 1957. This was basically largely in excess of what the other players in the S&P index were raking in per annum. If past performance is anything to go by, this company is worth looking into. Many skeptics remain worried that the declining numbers of smokers in the U.S might affect the performance of the Altria group. But as the company claims, and I agree with it, an increase in its shareholders wealth will be informed by disintegrating its holdings and offering to the market its individual sectors so as to avert any effect of a probable tobacco litigation on its non-cigarette holdings value.
Conclusion
it is important to note that the Altria company is a classical business in which smart investors may be interested in. The negative sentiments in the market about this company being vulnerable to future tobacco litigation is naive as the businesses fundamentals might not be affected at all by such a move. In my own opinion, this is one company to watch.
References
Thomsett, M.C. (2007). The stock investor’s pocket calculator: a quick guide to all the formulas and ratios you need to invest like a pro. AMACOM Div American Mgmt Assn
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