April 16, 2025 a 07:30 am
PM: Dividend Analysis - Philip Morris International Inc.
Philip Morris International Inc. presents an intriguing dividend profile characterized by a strong history and consistent growth. With a current yield of 3.51% and a stable increase over the past five years, the company proves to be a consistent dividend payer in the tobacco sector. Despite some concerns over a high payout ratio, Philip Morris demonstrates resilience through its operational cash flow and capital allocation strategies.
Overview 📊
Philip Morris International operates primarily within the tobacco industry, providing insightful value to income-focused investors through its dividend policies.
| Metric | Detail |
|---|---|
| Sector | Tobacco |
| Dividend yield | 3.51 % |
| Current dividend per share | $5.27 USD |
| Dividend history | 18 years |
| Last cut or suspension | None |
Dividend History 📜
Understanding the dividend history provides insight into the company's commitment to returning value to shareholders. Philip Morris has maintained a robust dividend distribution over the past years.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 1.35 |
| 2024 | 5.30 |
| 2023 | 5.14 |
| 2022 | 5.04 |
| 2021 | 4.90 |
Dividend Growth 📈
The company exhibits a moderate but consistent increase in dividends, reflecting its stability and growth orientation. Analysis of its growth patterns enhances forecasts about future dividend policies.
| Time | Growth |
|---|---|
| 3 years | 2.65 % |
| 5 years | 2.78 % |
The average dividend growth is 2.78% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio 🏦
Payout ratios are crucial in assessing the sustainability of a company's dividend payments. Exploring these ratios reveals potential risks and rewards associated with the dividend policy.
| Key figure | Ratio |
|---|---|
| EPS-based | 116.15 % |
| Free cash flow-based | 76.21 % |
High EPS payout ratios like 116.15% may signify stress on earnings ability to cover dividends, while a 76.21% FCF-based ratio suggests healthier coverage from free cash flow.
Cashflow & Capital Efficiency 💹
Analyzing cash flow and capital efficiency informs on operational fluidity and strategic financial management.
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| Free Cash Flow Yield | 5.76% | 5.40% | 6.20% |
| Earnings Yield | 3.77% | 5.34% | 5.77% |
| CAPEX to Operating Cash Flow | 11.82% | 14.35% | 9.97% |
| Stock-based Compensation to Revenue | 0% | 0% | 0.58% |
| Free Cash Flow / Operating Cash Flow Ratio | 88.18% | 85.65% | 90.03% |
The data suggests proficient management of capital expenditure and a robust cash flow cycle capable of sustaining corporate obligations and shareholder returns.
Balance Sheet & Leverage Analysis 📉
Assessing the balance sheet focuses on liquidity and leverage conditions, revealing fiscal soundness.
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| Debt-to-Equity | -2405% | -4268% | -4814% |
| Debt-to-Assets | 73.96% | 73.36% | 69.91% |
| Debt-to-Capital | 100.04% | 130.60% | 126.22% |
| Net Debt to EBITDA | 2.59 | 3.35 | 2.89 |
| Current Ratio | 0.88 | 0.75 | 0.72 |
| Quick Ratio | 0.47 | 0.34 | 0.36 |
| Financial Leverage | -3251.79 | -5.82 | -6.89 |
The balance sheet indicates high leverage with responsibilities primarily debt-dependent, stressing the necessity for efficient cash flow management.
Fundamental Strength & Profitability 💪
Reviewing profitability metrics illuminates operational efficiency and gross profitability.
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| Return on Equity | -371.42% | -69.41% | -101.02% |
| Return on Assets | 11.42% | 11.93% | 14.67% |
| Net Profit Margin | 18.63% | 22.15% | 28.49% |
| Gross Margin | 64.81% | 63.35% | 64.65% |
| EBIT Margin | 36.86% | 34.05% | 39.69% |
| EBITDA Margin | 41.58% | 38.02% | 43.43% |
| Research & Development to Revenue | 0% | 2.02% | 2.02% |
The company's profitability margins highlight a robust operating model; however, volatility in returns on equity suggests potential strategic improvements in capital deployment.
Price Development 💸
Dividend Scoring System 🗣️
| Category | Score | Indicator |
|---|---|---|
| Dividend yield | 4 | |
| Dividend Stability | 5 | |
| Dividend growth | 3 | |
| Payout ratio | 2 | |
| Financial stability | 3 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 2 |
Total Score: 28/40
Rating ✅
Philip Morris International Inc. represents a sound investment for dividend-seeking portfolios, highlighted by its consistent payout history and moderate growth rate. However, the high payout ratio and significant leverage warrant cautious optimism. The company stands robust in its industry, suggesting strategic exposure with guided risk assessment.