Why Altria Could Plummet This Year

Altria Group Why Altria Could Plummet This YearIt’s no secret how tumultuous tobacco stocks can be. With legislation always coming through or pending that seeks to limit the industry’s ability to grow, big companies like Altria Group (MO) are always looking for new ways to cash in. The truth is, that in such a tumultuous market, only the strong will survive. Unfortunately for Altria, it seems like it may be in the downside of the battle.

Competitors Phillip Morris International (PM) and Lorillard (LO) are not only bigger, but they have been more profitable so far in 2012, a trend continuing on from last year. Altria, meanwhile, has seen a drop in its sales volume. This drop has slid the company behind its two larger competitors and into a category with other competitor Reynolds American (RAI) as a less attractive big tobacco stock option.

It’s not a good position to be in. The tobacco company continues to profit but its longevity is in question now more than ever. Just last month, the Center for Disease Control and Prevention unveiled a $54 million plan to attack the tobacco industry. The campaign is another in the long list of shock-and-awe marketing done to try to prevent smoking and tobacco use. This time around, however, will feature the first ever television advertisements put on by the CDC.

The clasping down by the CDC, and other American regulatory institutes, has led some investors to go with Phillip Morris International.To continue reading, click here.

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