Investors love dividend stocks, especially the high-yield variety, because they offer a significant income stream and have massive total return potential.
In a turbulent market environment, Altria Group remains a reliable income pick and personal ATM in my portfolio. The tobacco giant has impressive distribution might that I believe it can use to expand into non-nicotine adjacencies. Altria Group's debt-to-EBITDA ratio is near its target and the company's annual debt maturities are well-staggered.
It's been a tough year for stocks overall. But Altria Group (MO -0.40%) has bucked the trend, rising in value by nearly 10% even as broader market indexes dropped sharply in value.
Altria's dividend is sustainable with a payout ratio aligned with management's 80% target and consistent free cash flow growth. Despite declining smoking rates, Altria's pricing power and high return on invested capital drive earnings and gross profit growth. Management is pivoting towards a smoke-free future, investing in smoke-free products to sustain long-term growth.
Altria (MO 0.79%) is a hard stock to love, even if you are a dividend investor. And it probably isn't the type of company you'll want to own for the rest of your life.
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