Philip Morris International (PM)
Consumer Staples · $304B market cap · SEC CIK 0001413329
ahead of 92% of the S&P 500 · #1 of 36 in Consumer Staples
Next reports on Feb 4, 2027, after the close, with analysts expecting $1.87 in earnings per share.
52-week range $146.35 to $214.35. 9% below its 52-week high and 33% above its low.
The case for PM
- Generated $10.7B of free cash flow in FY2025, 26% of revenue.
- 25% of revenue drops through to net profit.
- Earns 16% a year on everything it owns (return on assets).
- Pays a 5.5% dividend while you wait.
- Gross margin of 68% absorbs cost shocks.
- Moves less than the market (beta 0.35).
The case against
- Priced at 7.1× sales with revenue growing only 7.9%.
- Owes more than it owns: shareholder equity is −$10.0B, usually the result of buybacks funded with debt. ROE and price-to-book mean little here.
- Dividend takes 86% of earnings, leaving little cushion.
- Long-term debt of $45.1B against $4.9B of cash.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Consumer Staples companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 65 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 71 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 87 |
| Momentumhow the price has behaved lately | 68 |
| Stabilityhow violently it moves, what it owes and what it pays you | 48 |
- Shareholder equity is negative, so return on equity, price-to-book and debt-to-equity are left out.
- Each factor except momentum is half fixed thresholds, half rank among the 36 Consumer Staples companies.
The financials
Revenue growth
Is the business growing? Slowly
| Last 12 months | +7.9% |
|---|---|
| Over 5 years | +7.2% a year |
| FY2025 revenue | $40.6B (+7%) |
Free cash flow
Is it generating real cash? Yes, plenty
| FY2025 free cash flow | $10.7B |
|---|---|
| Of revenue | 26% |
| Of profit | 94% |
Profit margins
Is profitability improving? Yes, improving
| Gross margin | 68% |
|---|---|
| Operating margin | 39% |
| Net margin, FY24 → FY25 → now | 18.6% → 27.9% → 24.8% |
Debt vs. cash
Is the balance sheet healthy? Stretched
| Cash | $4.9B |
|---|---|
| Long-term debt | $45.1B |
| Net debt | $40.3B |
| Years to repay | 3.7 yrs |
Valuation
Is the stock price reasonable? Yes, about fair
| P/E | 28.4× |
|---|---|
| Fair P/E for its growth | 27× |
| P/FCF | 28.5× |
| Forward P/E | 23.4× |
| EV / EBITDA | 18.4× |
At 28.4× earnings it trades close to the 27× that 7% a year of growth plus a 5.5% dividend would justify. At 28.5× free cash flow it trades close to that same mark.
The financials, five years deep
Pulled from Philip Morris International's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $40.6B | $37.9B | $35.2B | $80.7B | $82.2B |
| Change on the year | +7% | +8% | −56% | −2% | — |
| Free cash flow | |||||
| Free cash flow | $10.7B | $10.8B | $7.9B | $9.7B | $11.2B |
| Of revenue | 26% | 28% | 22% | 12% | 14% |
| Profit margins | |||||
| Gross margin | 67.1% | 64.8% | 63.3% | 25.2% | 26.0% |
| Operating margin | 36.6% | 35.4% | 32.9% | 15.2% | 15.8% |
| Net margin | 27.9% | 18.6% | 22.2% | 11.2% | 11.1% |
| Debt vs. cash | |||||
| Cash | $4.9B | $4.2B | $3.1B | $3.2B | $4.5B |
| Long-term debt | $45.1B | $42.2B | $41.2B | $34.9B | $24.8B |
| Net cash (debt) | −$40.3B | −$38.0B | −$38.2B | −$31.7B | −$20.3B |
What Philip Morris International says it does
Development of Business General Philip Morris International Inc. is a Virginia holding company incorporated in 1987. In March 2008, we became a U.S. public company listed on the New York Stock Exchange and subject to the rules of the U.S. Securities and Exchange Commission (the "SEC"). We are a leading international consumer goods company, actively delivering a smoke-free future and evolving our portfolio for the long term to include products outside of the tobacco and nicotine sector. Our current product portfolio primarily consists of cigarettes and smoke-free products, including heat-not-burn, nicotine pouch and e-vapor products. Since 2008, we have invested over $16 billion to develop, scientifically substantiate and commercialize innovative smoke-free products for adults who would otherwise continue to smoke, with the goal of completely ending the sale of cigarettes. This investment includes the building of world-class scientific…