PM Stock Alert: What to Know as Philip Morris Teams Up With Altria on Manufacturing

Philip Morris International (PM) shares experienced a surge on Aug. 24 following a contract manufacturing agreement with Altria Group (MO). The deal allows PM's non-U.S. affiliates to collaborate with Philip Morris USA on combustible-cigarette manufacturing, with shipments starting early 2027. After the announcement, PM stock rose nearly 25% compared to its year-to-date low.

IonQ Quantum Computing, Nvidia Stock, and Warsh's Jackson Hole Speech Await QQQ's Negative Gamma Regime. Get the FREE Barchart Brief for stock movers, trending sectors, and actionable trade ideas. Philip Morris expects negligible impact on 2026 financials as it will not commercialize combustible cigarettes domestically in the U.S. The alliance is seen as a net positive for investors, as it positions PM for high margins in traditional tobacco and operational efficiencies, freeing up cash flow.

With an 11.7% year-on-year growth in its smoke-free segment, PM's current valuation looks attractive, trading at a price-to-sales ratio of 3.18x and holding a Moderate Buy consensus rating with potential upside of 18%.