5 Best Tobacco and Cigarette Stocks To Buy

1. Philip Morris International Inc. (NYSE:PM)

Number of Hedge Fund Holders: 54

Philip Morris International Inc. (NYSE:PM) is a tobacco company that aims to transition toward a smoke-free future by expanding its product range beyond tobacco and nicotine. Their portfolio includes cigarettes, smoke-free products like IQOS and ZYN, and lighters and matches. Philip Morris International Inc. (NYSE:PM) is one of the best tobacco stocks to invest in. On October 19, the company reported a Q3 non-GAAP EPS of $1.67, beating market estimates by $0.05. The revenue increased 13.8% year-over-year to $9.14 billion. However, it fell short of Wall Street consensus by $80 million. 

According to Insider Monkey’s second quarter database, 54 hedge funds were bullish on Philip Morris International Inc. (NYSE:PM), compared to 55 funds in the prior quarter. Terry Smith’s Fundsmith LLP is the largest position holder in the company, with 15.7 million shares worth $1.5 billion.

Ariel International Fund made the following comment about Philip Morris International Inc. (NYSE:PM) in its Q1 2023 investor letter:

“Finally, tobacco maker, Philip Morris International Inc. (NYSE:PM) declined in the period on concerns related to supply-chain disruptions resulting from the war in Ukraine, which we view as temporary. We believe the favorable economics and margin expansion associated with market share gains from the IQOS brand and Reduced Risk Products should yield value creation opportunities in the years ahead. Furthermore, at current trading levels, we think the company’s operating leverage, pricing power, and free cash flow profile offer a margin of safety.”

Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily enewsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also check out Top 11 Extreme Value Stocks To Buy and Top 20 Gold Mining Companies in the World.