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Non-Tech : Philip Morris - A Stock For Wealth Or Poverty (MO)
MO 64.14+3.0%Feb 3 3:59 PM EST
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To: Geoff who wrote (2014)7/28/1998 9:05:00 AM
From: Rarebird  Read Replies (2) of 6439
 
This rally is for real, has legs to it and is based on a few reasons:

1) MO reported earnings last week that met Street Estimates and topped last years results by 9%. This may not be great for MO, but it is sure a welcome reprieve from the pitiful earnings that have been coming out of the S&P 500 this quarter. Year over year comparison is about 2%.
2) On the day they reported earnings, company officials announced ( without being asked ) the renewed possibility of a share buyback beginning in the fourth quarter.
3) Clinton has given up hope on any settlement resembling the McCain bill and has stopped jaw boning the tobacco industry.
4) The litigation front has turned positive for the tobacco industry and a favorable settlement with the state attorney generals looks promising.
5) Economic growth is slowing rapidly as we speak. As a consumer staple, MO provides consistency of earnings growth that few companies can match. The Market is ready to reward it by expanding its multiple.
6) Technically speaking, MO is now in an uptrend. The stock is now sitting above its 200 and 400 day moving averages for the first time since February. It has not gone un-noticed by astute market observers that the stock broke out to the upside as the rest of the Market headed south.

I see a continuation of the uptrend in the coming weeks. Given such adverse market conditions, the breakout was very impressive on heavy volume. We are at the beginning of the breakout.
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