Stifel on Monday raised its price objective for Philip Morris (NYSE:PM) to $200.00 from $180.00 while maintaining a Buy recommendation on the stock. At the time of the update, shares were trading at $182.81, roughly 2% below the 52-week high of $186.69 and having returned 31.06% over the past year.
Market indicators flagged in the report show that the stock’s relative strength index (RSI) may suggest overbought conditions, even as the security trades at a low PEG ratio of 0.41. Stifel’s decision to lift the target follows the company’s fourth-quarter performance, which the firm described as stronger than expected.
In that quarter, Philip Morris reported both volume growth and an expansion in operating profit margins that exceeded Stifel’s estimates. The company’s gross profit margin remains elevated at 67.12%, a metric the analyst cited as underpinning the firm’s improved view of the shares.
Philip Morris also issued its initial outlook for fiscal year 2026. On a constant currency basis, management expects sales to rise 5%-7% and earnings per share to increase 7.5%-9.5%. Stifel characterized these targets as broadly in line with market expectations despite the guidance including some unique headwinds.
Valuation and income metrics included in the update show a current price-to-earnings ratio of 25.18 and a dividend yield of 3.22%. The analyst note emphasized the company’s renewed medium-term targets through fiscal 2028, which mirror prior 2024-2026 objectives: organic sales growth of 6%-8% and EPS growth of 9%-11% on a constant currency basis.
Stifel pointed to momentum in smoke-free products as a significant driver of future growth. The company expects high single-digit to low-teen volume growth in the smoke-free category, and the analyst highlighted the combined effect of overall volume increases, the mix shift toward smoke-free products, and pricing actions as the primary factors supporting the Buy rating.
In related disclosures, Philip Morris reported fourth-quarter 2025 earnings per share of $1.70, matching analyst expectations, while revenue came in at $10.4 billion versus projected revenue of $10.39 billion. Despite meeting and slightly exceeding these forecasts, the stock experienced a decline in pre-market trading following the release.
The earnings announcement did not include any significant mergers or acquisitions, and there were no notable analyst upgrades or downgrades from major firms reported alongside the release. Market participants continue to monitor the company’s execution against its medium-term targets and the evolution of the smoke-free product mix as they assess the stock’s outlook.
Contextual notes - The balance of strong margin performance, a clear growth outlook for 2026, and the firm’s reiterated medium-term targets provide the basis for Stifel’s higher price target. At the same time, technical indicators and a recent pre-market dip underline that investor sentiment can shift in the near term.