NEW YORK, NY / ACCESSWIRE / August 1, 2017 / Cigarette makers Altria Group and Philip Morris saw losses on Monday after an FDA announcement worried investors. The FDA has proposed a cigarette nicotine cut. Despite shares dropping, analyst Bonnie Herzog of Wells Fargo Securities thinks the announcement could be a good thing and said it may be "an opportunity over the long term for reduced-risk products. We see this as an opportune entry point for long-term investors and would recommend building positions on today's broad weakness."

RDI Initiates Coverage on:

Altria Group
https://ub.rdinvesting.com/news/?ticker=MO

Philip Morris International Inc.
https://ub.rdinvesting.com/news/?ticker=PM

Altria Group's shares closed down 2.94% yesterday on over 26 million shares traded. The average volume for the stock is roughly around 6 million shares. Altria group, a leading manufacturer of cigarettes and smokeless tobacco products in the U.S., was one among other cigarette stocks to take a blow after the FDA announced last Friday that it is working towards lowering nicotine levels in cigarettes. Altria's share prices were down over 9% after the news and continued to fall on Monday. The company who is behind the Marlboro name recently posted its second quarter 2017 earnings. The Zacks consensus estimate was EPS of 86 cents and revenue of $4.988 billion. Altria beat on revenue with $5.068 billion but lagged on adjusted earnings per share at 85 cents.

Access RDI's Altria Group Research Report at:
https://ub.rdinvesting.com/news/?ticker=MO

Philip Morris International Inc.'s shares closed down 1.52% on Monday on nearly 1.6 times trading volume compared to usual. It was a rough trading day for cigarette makers after the FDA announced last Friday that it has included a proposal that would lower the nicotine levels in cigarettes to non-addictive levels. According to FDA Commissioner Scott Gottlieb, "Nicotine itself is not responsible for cancer, the lung disease and heart disease that kill hundreds of thousands of Americans each year. It's the other chemical compounds in tobacco and in the smoke created by setting tobacco on fire that directly causes illness and death." While traders seem discouraged for cigarette companies after the announcement, the chief operating officer of anti-smoking nonprofit Truth Initiative, Dave Dobbins, assured that it wasn't yet an actual regulation. He remarked, "What didn't happen today is an announcement on actual regulation... What happened was an announcement that a docket would be opened." To be noted about Philip Morris is that the company markets its products outside the United States, which may explain why the stock's drop wasn't as bad as it could have been.

Access RDI's Philip Morris International Inc. Research Report at:
https://ub.rdinvesting.com/news/?ticker=PM

Our Actionable Research on Altria Group (NYSE: MO) and Philip Morris International Inc. (NYSE: PM) can be downloaded free of charge at Research Driven Investing.

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SOURCE: RDInvesting.com