Philip Morris (NYSE:PM) International Stocks on its Way to Touch New Peaks

The long-term investors were delighted by the proficiency of Philip Morris International (NYSE:PM) following its separation from its founder company Altria Group (NYSE:MO) that took place in the year 2008. The tobacco tycoon’s stocks elevated after the initial financial difficulties and made most of the international opportunity that the rising industry offered. However, since the previous year the company has not been able to retain its position. Due to his reason, some of the company’s shareholders have become skeptical and have doubts about the performance of the company in the upcoming years. However, there are still other shareholders who still have faith in the company’s (NYSE:PM) ability and they point out various factors that can lead the company to its lost heights once again.

Of late, many international governments have started to implement regulatory laws just like US, which has affected the market in many areas. This is the reason that has kept Philip Morris (NYSE:PM) away from the international market.

Due to Philip Morris’ (NYSE:PM) inactivity in terms of stock-price, the company’s premium revenue is 4.5%. Furthermore, the management at Philip Morris (NYSE:PM) has decided to keep the company’s premium a priority. The management has decided to focus on giving the shareholders 100% of the cash flow in the way of either premiums or share buybacks. The fact that since 2008 Philip Morris (NYSE:PM) has been able to double its premium payouts makes the investors believe in the company.

A comparatively better decline in the global cigarette industry in itself is an advantage for Philip Morris:

The reason of the bad performance of Philip Morris’ (NYSE:PM) stock is the overall decreasing cigarette volumes. However, because of the recent decline the expectations of the investors with the tobacco companies have also been reduced.

Philip Morris (NYSE:PM) has recently said that the company has anticipated a 2.9% decline in the cigarette volume in 2014, leaving out U.S and China. However, the company believes that the decrease in volumes will slow down in the following year to 1% and 2%. Keeping the low numbers in mind it can be said that all the company needs to do is to keep its business stable and gain the required volumes. The target seems very much achievable.

The iQOS products can be a huge help for the company.

With the increasing awareness, the market of tobacco products is rapidly decreasing and to overcome this problem many companies have been working on alternatives like electric cigarettes. Philip Morris (NYSE:PM) has been working on these lines quite aggressively and has launched its line of Marlboro HeatSticks system in Italy in the start of this month. The company has had a successful launch in Japan before that. Although the alternative products have its share of obstacles in the market, the company is trying hard to make the industry involved in the product and if the company succeeds in getting the alternative products popular in the market then it will be a huge benefit for the future of the company.