Philip Morris stock up after new forecast
CHICAGO (Reuters) - Philip Morris International(PM.N) said earnings, helped by higher prices, would grow more than expected in 2010, excluding the impact of the weakening euro, sending its stock up almost 4 percent.
"The underlying business will grow this year," Morningstar analyst Philip Gorham said.
The euro's weakness, however, means that Philip Morris, which sells Marlboro cigarettes and other brands, expects its earnings per share to be about 5 cents lower than its previous estimates.
The revised earnings outlook reflects a negative currency impact of 20 cents, Chief Executive Louis Camilleri told investors at a meeting in Lausanne, Switzerland. The company provided Reuters with a copy of the meeting's transcript.
For the full-year 2010, the U.S. company expects to earn $3.70-$3.80 per share, down from its previous expectation of $3.75-$3.85 a share.
Analysts, on average, were expecting full-year earnings of $3.77 a share, excluding items, according to Thomson Reuters I/B/E/S.
But the company's projected underlying growth rate, which Gorham said shows performance on a constant-currency basis, was 14 percent to 17 percent for 2010. The rate projected in April was lower, at 10 percent to 13 percent.
An expected price increase on cigarettes sold in Japan was among the factors contributing to improved outlook, Chief Financial Officer Hermann Waldemer said during the investors meeting.
Shares of Philip Morris were at $46.73, up $1.74 or 3.8 percent in early afternoon trade on the New York Stock Exchange.
(Reporting by Emily Stephenson, Sakthi Prasad in Bangalore; Editing by Dan Lalor)