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Philip Morris Vs. British American: One Clear Winner

Philip Morris Vs. British American: One Clear Winner

Posted On January 31, 2019 8:54 am
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Philip Morris and British American are two of the most undervalued high-yield blue-chips you can buy right now. But if you can afford to buy just one right now then the choice is clear.

Summary

  • Tobacco companies have historically made excellent high-yield investments delivering steady dividend growth and market-crushing returns.
  • Today fear of rising anti-tobacco regulations and ongoing declines in smoking rates means that this high-yield industry is one of the most hated on Wall Street.
  • Philip Morris and British American Tobacco have seen their shares gutted over the last 18 months, creating extremely attractive deep value, high-yield investing opportunities.
  • Philip Morris is objectively the higher quality company, with a lower risk profile, stronger balance sheet, better profitability, and superior long-term growth prospects.
  • But British American is now so undervalued that it’s likely to deliver better total returns, making it the superior investment today (though both stocks are worth buying).

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Photo: “ADM8” by Ars Electronica is licensed under CC BY-NC-ND

About author

Dividend Sensei
Dividend Sensei

I'm an Army veteran and former energy dividend writer for The Motley Fool. I currently write for both Seeking Alpha, Simply Safe Dividends, and DividendSensei.com My goal is to help all people learn how to harness the awesome power of dividend growth investing to achieve their financial dreams, and enrich their lives. With 22 years of investing experience, I've learned what works and more importantly, what doesn't, when it comes to building long-term wealth and income streams. I'm currently on an epic quest to build a broadly diversified, high-quality, high-yield dividend growth portfolio that: 1. Pays a 5% yield 2. Offers 7% annual dividend growth 3. Pays dividends AT LEAST on a weekly, but preferably, daily basis

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2 Comments

  1. Bob westerlund January 31, 2019 at 9:15 pm

    I am 83 , and looking for income. I hate this market with politics the way they are. But, I am forced to invest somewhere.

    • Dividend Sensei February 1, 2019 at 4:23 am

      I hate it too. But these stocks could be just what you’re looking for right now.

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