RBC Capital provided their outlook on Altria Group, Inc. (NYSE:MO) ahead of the upcoming Q3 results, expecting net sales to be up 4% (vs. Street’s 2% growth estimate), smokeable volumes down 3% year-over-year (vs. Street’s 5% decline estimate), and EPS of $1.31 (vs. Street’s $1.30).
Based on their channel checks, the analysts believe that the trade-down in the cigarette category continues and Marlboro is still losing market share. However, the company will cycle easier comparisons, which should help reported results relative to underlying trends.
After the agreement with Philip Morris for the US IQOS transition, the analysts are looking for more color on the company's planned innovation. The analysts expect the company’s shares to be relatively stable during earnings, especially as investors continue to take a defensive posture. The analysts expect the company to reiterate its fiscal 2022 EPS guidance of $4.79-$4.93 (vs. Street’s $4.84), representing approximately 4-7% year-over-year growth.