Philip Morris International Inc. (PM): Strategic Shift Towards Smoke-Free Products

By Patricia Miller

Mar 03, 2025

1 min read

Philip Morris is exploring a $1B sale of its US cigar business, reinforcing its shift to smoke-free alternatives. How will this impact its growth strategy?

Tobacco Background. Group of Cuban Cigars on Vintage Tobacco Leaves

#What You Need to Know

Philip Morris International Inc. (NYSE: PM) is currently contemplating a sale of its US cigar business, seeking more than $1 billion. This move aligns with the company’s strategy to transition towards smoke-free alternatives, reducing its dependence on traditional tobacco products. Shares of Philip Morris have risen significantly this year, boosted by the success of its smoke-free product lines like Zyn pouches. The company previously acquired its cigar division from Swedish Match AB in a $16 billion deal completed in 2023. Although discussions around the potential sale are ongoing, they do not guarantee a completed transaction as it is still being evaluated by advisers.

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#Why This Is Important for Retail Investors

  • Market Trend Awareness: Understanding the shift to smoke-free products can help investors gauge market trends and align their portfolios.

  • Strong Financial Position: Philip Morris’s stock has grown by 29% this year, indicating strong performance that may attract further investment opportunities.

  • Diversification: The potential sale of its cigar business may signal a strategic pivot, allowing for broader diversification in revenue streams.

  • Impact on Tobacco Sector: As the tobacco industry faces declining smoking rates, investors should consider how companies are adapting to remain profitable.

  • Growth Potential: Insights into the growing popularity of products like Zyn pouches inform investors about potential future earnings.

#Relevant ETFs

  • Invesco S&P 500 Equal Weight Consumer Staples ETF

  • iShares Global Consumer Staples ETF

  • SPDR S&P Tobacco ETF

  • iShares U.S. Consumer Goods ETF

  • Altria Group, Inc. ETF

  • Vanguard Consumer Staples ETF

$300 Billion Gone!

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Important Notice And Disclaimer

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

Patricia Miller does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the above article.

Patricia Miller has not been paid to produce this piece by the company or companies mentioned above.

Digitonic Ltd, the owner of ValueTheMarkets.com, does not hold a position or positions in the stock(s) and/or financial instrument(s) mentioned in the above article.

Digitonic Ltd, the owner of ValueTheMarkets.com, has not been paid for the production of this piece by the company or companies mentioned above.