Goldman Sachs' Bonnie Herzog Sets New Price Target for Philip Morris International

Bonnie Herzog of Goldman Sachs Sets New Price Target for Philip Morris International

Bonnie Herzog of Goldman Sachs recently set a new price target for Philip Morris International Inc. (PM:NYSE) at $118, suggesting a significant potential upside from its current trading price. This optimistic outlook, as reported by StreetInsider, comes at a time when PM's shares were trading at $94.06, indicating a potential increase of about 25.45%. Goldman Sachs' confidence in PM's stock performance is based on several key factors that underline the company's strong financial health and market position.

Philip Morris International has been showing strong performance, especially with its first-quarter earnings for 2024 surpassing expectations. The company reported an increase in net earnings per share to $1.38 from $1.28 the previous year, demonstrating solid growth. This performance is particularly noteworthy as it comes despite a slight decline of 0.7% in premarket trading on the day of the announcement. The dip was a reaction to a less optimistic outlook for the second quarter, yet the overall strong earnings report underscores the company's robust financial health.

The company's CEO, Jacek Olczak, highlighted the excellent top-line growth and significant margin expansion experienced in the first quarter. This positive momentum, especially in the smoke-free product category, has led to rapid volume progression and an acceleration in organic net revenue and gross profit. Such achievements have allowed Philip Morris International to raise its currency-neutral guidance for the full year of 2024, signaling confidence in its continued financial success.

Moreover, ahead of its earnings season, Philip Morris International has seen favorable earnings estimate revisions, with the most accurate estimate for the current quarter standing at $1.46 per share. This surpasses the broader Zacks Consensus Estimate of $1.41 per share, resulting in a Zacks Earnings ESP (Earnings Surprise Prediction) of +3.75% for Philip Morris International. This positive adjustment in earnings projections indicates that analysts, equipped with the latest information, have grown more optimistic about the company's performance.

The recent trading session saw PM's stock price increase by 2.25, marking a 2.39% rise, to close at 96.31. This movement in stock price, along with the company's strong financial indicators and Goldman Sachs' updated price target, suggests that Philip Morris International is well-positioned for future growth. The company's market capitalization of approximately 149.52 billion, coupled with its performance in the smoke-free product category and positive earnings revisions, supports Goldman Sachs' confidence in PM's ability to outperform in the market.