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Fly News Breaks for September 10, 2019
Sep 10, 2019 | 06:05 EDT
Piper Jaffray analyst Michael Lavery downgraded Altria Group (MO) to Neutral from Overweight and lowered his price target for the shares to $49 from $64. Following discussions between Altria and Philip Morris (PM) of a potential merger of equals, the analyst has less confidence in Altria's outlook. The analyst says any interest in a deal without a premium could suggest more stress on the underlying fundamentals and management's outlook for the future than he had appreciated. Further, the analyst adds that while potential earnings from the Juul stake may be underappreciated, he's also less confident on Altria's approval from the FTC and FDA. He prefers more clarity from regulators before getting more bullish on the vapor outlook.
News For MO;PM From the Last 2 Days
Sep 19, 2019 | 16:29 EDT
Stocks spent the morning in the green with the S&P back in striking distance of its prior record high following yesterday's widely anticipated quarter point rate cut from the Federal Reserve. However, the averages... To see the rest of the story go to See Story Here
Sep 19, 2019 | 12:33 EDT
The CDC said in a statement on its website: "There are 530 cases of lung injury reported from 38 states and 1 U.S. territory. Seven deaths have been confirmed in 6 states. CDC has received complete sex and age data on 373 of 530 cases. Nearly three fourths (72%) of cases are male Two thirds (67%) of cases are 18 to 34 years old. 16% of cases are under 18 years and 17% are 35 years or older. All reported cases have a history of e-cigarette product use or vaping. Based on initial data from certain states we know: Most patients have reported a history of using e-cigarette products containing THC. Many patients have reported using THC and nicotine. Some have reported the use of e-cigarette products containing only nicotine. We do not yet know the specific cause of these lung injuries. The investigation has not identified any specific e-cigarette or vaping product (devices, liquids, refill pods, and/or cartridges) or substance that is linked to all cases." Juul, in which Altria Group (MO) has a 35% stake, is the dominant e-cigarette maker in the U.S. Altria and Philip Morris (PM) are currently in merger talks. Reference Link
Sep 18, 2019 | 19:04 EDT
CBS (CBS), AT&T's (T) WarnerMedia, and Viacom (VIAB) have said that they will start pulling e-cigarette advertising from their airways, CNBC's Megan Graham reports. A spokesman for CBS said the company has stopped taking future e-cigarette advertising, while a spokeswoman for WarnerMedia said that it is dropping e-cigarette advertising from its networks, including CNN, TNT, and TBS, Graham says. "After reviewing the recent reports regarding the potentially serious health threats posed by e-cigarettes, Viacom has revised its policies regarding e-cigarette advertising, and will no longer air ads in this category effective immediately," a spokesperson for the company said. Publicly traded companies in the tobacco space include Altria Group (MO), British American Tobacco (BTI), Imperial Brands (IMBBY) and Philip Morris (PM). Juul, one of the most popular e-cigarette brands, is 35% owned by Altria. Reference Link
Sep 18, 2019 | 08:13 EDT
The House subcommittee that oversees consumer product investigations is threatening to subpoena Juul, saying the e-cigarette maker is not cooperating with a congressional probe looking at whether the company intentionally targeted kids, CNBC's Angelica LaVito reports. Subcommittee Chairman Raja Krishnamoorthi says Juul has not fully complied with the panel's request and that the company has until October 1 to respond. Lawmakers have made several requests to Juul co-founder James Monsees and Chief Administrative Officer Ashley Gould, including the list of schools that received funding from Juul for anti-vaping curriculum and the contract Altria signed with Juul when it took a 35% stake in the company late last year. Reference Link
Sep 18, 2019 | 07:08 EDT
Citi analyst Adam Spielman believes a merger between Philip Morris (PM) and Altria Group (MO) is getting more probable. If shareholder pressure was going to cause the managements to cancel the deal talks, we probably would have heard by now, Spielman tells investors in a research note. Juul is unlikely to be a big part of the merger, so the crackdown on e-vapor flavors will not make much of a difference to the merger, adds the analyst. He believes that if there's a "plain vanilla merger," the emphasis will be on the potential profit from new products in the U.S. However, there are "significant weaknesses to this argument," says Spielman.