Can Altria Stock Surpass Its Pre-Covid Level?

Can Altria Stock Surpass Its Pre-Covid Level?

BRAZIL - 2020/03/28: In this photo illustration the Altria logo is displayed on a smartphone. (Photo ... [+] Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images)



SOPA Images/LightRocket via Getty Images

We believe Altria stock (NYSE: MO) may be a decent opportunity at the moment. MO trades at $41 currently and is in fact down 18% from $50 at the beginning of 2020. It traded at close to $45 in February 2020, just before the outbreak of the pandemic, and is still 9% below that level now. MO stock has gained 30% from the low of $31 seen in March 2020, less than the S&P 500 which is up 70% from its March 2020 lows. MO stock has underperformed the broader market because the drop in the stock when the crisis hit was less than the market in the first place, as it belongs to the defensive sector of tobacco. That said, with the lockdowns being lifted, supply constraints are likely to ease leading to higher shipments. Also, the expectations of rising sales of IQOS e-cigarettes in the US is likely to boost revenues and margins in 2021. This could take the stock to