Another Recent Buy – Altria Group (MO)
This purchase has been brewing for sometime. The stock has been below my cost basis for awhile now. I have been waiting and been patient and have finally decided to pull the trigger. This purchase will lower my cost basis by almost $10 per share which is fantastic. I can only dream of being able to lower all of my costs basis’s by at least $10 a share. If the share price continues to drop, I would definitely consider adding more to this position.
Let’s take a look at some of the catalyst that led me to making this purchases.
1. Here recently, the FDA approved the use of Altria’s IQOS technology, which is a form of smoking tobacco that allows the user to heat the tobacco up instead of burning it.
2. Lately, I have seen in the news headlines that JUUL is considering the possibility of opening retail locations. Given Altria’s investment in JUUL that will only help to drive revenue higher over the long term.
3. Over the past few months, the company has seen a lot of insider trading as reported in this article titled “Altria Group Named Top Dividend Stock With Insider Buying”. Who would have the best insight into a business? Definitely the people who work for said business.
To me these are some very compelling points. We all know that cigarette sells have been on the decline for years but the company is not ignoring this fact. They have made some significant investments to try and find a new revenue growth driver for the business. Outside of those I mentioned, they have also made investments into the cannabis industry.
It seems as though the future could be very bright for the company. Once the tides shift and the share price begins it’s ascent I want to to be on board. Given the right opportunities, I will continue to invest in the company.
Now, we have been looking at some things in the future of the business. How about we take a look at some metrics from their recent past.
Altria Group Stock Dividend Data
Current Dividend Yield: 6.52%
Annual Dividend: $3.20
Payout Ratio: 80%
Dividend Growth History: 10 years
Earnings Per Share: $4.00
PE Ratio: 11.76
Recap of Information on Altria Group
Altria Group has definitely had their share of headwinds. The declining sale of cigarettes has been an issue that they have been faced with for some time. It seems to me like they are making some great investments which will produce some great returns for them. They are not sitting by idle while the business falls apart and this shows. The stock is selling very cheap now with a great PE ratio considering where the rest of the market is currently at right now.
Altria Group Impact on More Dividends
I added 10 shares of Altria Group at an average price of $49.93. This addition to my portfolio will add $32.00 to my projected annual dividend income not including the compounding factor. My current position in Altria Group contributes $55.67 to my projected annual dividend income.
Altria Group is a good company which I am prepared to hold stock in for a very long time. If the share price goes down then I buy more. If it goes up then I will sit back and collect dividends. The company appears to be making some of the right moves to set themselves up for a very prosperous future. I am well aware that these things do not happen overnight and that is why I am preparing myself regardless of which way the stock price goes.
Have you recently purchased stock in Altria Group? Do you currently own any shares of ExxonMobil? If so I would love to hear about it.
As always I look forward to reading all of your comments and questions, until then….. happy investing!
-Jason from MoreDividends.com
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