Close, but No Cigar(ettes)

Can this stock survive much longer? [Shield] AN OXFORD CLUB PUBLICATION [Wealthy Retirement]( [View in browser]( SPONSORED The 2 AI Investing Traps Revealed [Must Read] Investor and entrepreneur James Altucher made millions during the crypto boom. Many "experts" are now saying... [Artificial Intelligence opportunities could be even bigger.]( But don't believe the hype. Before you invest one penny in AI... See James reveal the [2 AI investing TRAPS]( that will doom many investors... Yes, making money from AI SHOULD be easy... But most AI investors will fall flat on their faces. Because they don't know the 2 AI investing TRAPS. [See the 2 AI investing traps here now]( [THE VALUE METER]( [Close, but No Cigar(ettes)]( [Jody Chudley, Contributing Analyst, The Oxford Club]( [Jody Chudley]( A reader recently requested that I put cigarette manufacturer Altria Group (NYSE: MO) through The Value Meter. Honestly, I could hardly ask for a more interesting assignment. For the three decades of my adult life, it has been clear to me (and everyone) that the cigarette business is in a permanent decline. Yet when I pull up Altria's long-term stock chart and compare it with the S&P 500's, this is what I see... [Chart: Altria Group "Smoking" the S&P 500]( Wow! Incredibly, Altria is the seventh-best-performing stock in the entire market over the past three decades. Who would've thought that was possible for a company in a declining industry? If I had somehow bought $10,000 worth of Altria stock when I graduated high school in 1991, reinvested my dividends and held it until today... I would have $10.8 million! Clearly, when we look in the rearview mirror, Altria looks great. But looking backward isn't what successful investing is about. We need to determine how Altria's stock is likely to perform going forward. And this is where valuing Altria gets very tough. For years, Altria and other cigarette manufacturers have been able to offset declining sales volumes with price increases. But they can't do that if sales volume disappears entirely... Which is becoming a real risk. Late last year, New Zealand introduced a generational smoking ban, which outlaws cigarette sales to anyone born after January 1, 2009. The U.K. is considering a similar policy, and I don't doubt other countries will follow. It goes without saying that a ban on Altria's main product would be horrendous news for its business. It should be noted, though, that Altria's management is attempting to steer the company toward selling less harmful, smokeless products. So far, the company is having some success with this effort, but it's still too early to discern the overall effect on the business. Regarding Altria's current valuation, it's possible that the long-term decline of smoking has already taken a toll. The stock trades at barely eight times earnings, so there is no optimism being priced in. But investors may be optimistic about the company's dividend yield. The stock yields nearly 10% at current prices, and the dividend was rated "moderately safe" by Chief Income Strategist Marc Lichtenfeld [earlier this year](. With that kind of dividend, you don't need Altria's stock price to rise in order to achieve an excellent return. And that brings us back to the all-important question... Where does Altria come in on The Value Meter? The future of this business is just too uncertain for me to have any conviction on it. With countries around the world making moves to restrict smoking and cigarette sales, I believe that the risk here is much higher than it was 30 years ago. Despite the company's low valuation metric and huge dividend, there are better opportunities elsewhere. That is why The Value Meter rates Altria Group as being "Appropriately Valued." [The Value Meter](#) If you have a stock that you'd like to have rated by The Value Meter, leave the ticker symbol in the [comments]( section. Good investing, Jody [Leave a Comment]( [Investment U Conference 2024 at the Ojai Valley Inn & Spa in Ojai, California, February 26-29, 2024]( SPONSORED [AI Has One Huge Problem (Not Processing Power or Energy)]( [CPU processor chip]( It's NOT processing power... energy... clean data... or anything like that. But Google, Microsoft and Meta are already quietly shelling out cash to fix this problem. [Here's the top way to play this little-known trend.]( RECOMMENDED LINKS [One Potentially Explosive Stock That Alexander Green Just Discovered Has Seen Five-Year 2,000% Revenue Growth, Enjoys 70% Gross Margins and Sports a Debt-Free Balance Sheet, yet Still Trades Under $10. He's Calling It the "Next Great American Super Stock." (Click for Details.)]( [Discover the Top Passive Income Opportunity for 2023...]( MORE FROM WEALTHY RETIREMENT [Image of the Realty Income logo with "The Monthly Dividend Company" written below it]( [Realty Income: Can This Dividend Aristocrat Afford Its 6% Yield?]( [Image of Uncle Sam pointing at you with a stern facial expression]( [Buy Muni Bonds to Protect Your Cash From Uncle Sam]( [Image of a pan holding several nuggets of gold]( [The Best Ways to Play the Artificial Intelligence "Gold Rush"]( [Image of a hand about to topple a ]( [4 Tickers to Dethrone the "Magnificent 7" Stocks]( [Facebook]( [Facebook]( [LinkedIn logo]( [LinkedIn]( [Email Share](mailto:?subject=A%20great%20piece%20from%20Wealthy%20Retirement...&body=From%20Wealthy%20Retirement:%0D%0A%0D%0AHow much longer can this stock survive in a fading industry?%0D%0A%0D [Email Share](mailto:?subject=A%20great%20piece%20from%20Wealthy%20Retirement...&body=From%20Wealthy%20Retirement:%0D%0A%0D%0AHow much longer can this stock survive in a fading industry?%0D%0A%0D [Push Alert]( [Push Alert]( SPONSORED [92-Year-Old Multimillionaire's Strange Deathbed Regret]( [Old man in garden]( 92-year-old newfound multimillionaire Marvin turned $635K into $3.6M in 9 years. 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