Analyzing Altria Group (NYSE:MO) & Turning Point Brands (NYSE:TPB)

Altria Group (NYSE:MO) and Turning Point Brands (NYSE:TPB) are both consumer staples companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, institutional ownership, earnings and profitability.

Institutional and Insider Ownership

57.4% of Altria Group shares are held by institutional investors. Comparatively, 96.1% of Turning Point Brands shares are held by institutional investors. 0.1% of Altria Group shares are held by insiders. Comparatively, 5.4% of Turning Point Brands shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Altria Group pays an annual dividend of $4.44 per share and has a dividend yield of 5.7%. Turning Point Brands pays an annual dividend of $0.32 per share and has a dividend yield of 0.5%. Altria Group pays out 91.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Turning Point Brands pays out 13.7% of its earnings in the form of a dividend. Altria Group has raised its dividend for 56 consecutive years and Turning Point Brands has raised its dividend for 7 consecutive years. Altria Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Altria Group and Turning Point Brands”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Altria Group	$20.63 billion	6.31	$6.95 billion	$4.84	16.12
Turning Point Brands	$463.06 million	2.81	$58.17 million	$2.33	28.84

Altria Group has higher revenue and earnings than Turning Point Brands. Altria Group is trading at a lower price-to-earnings ratio than Turning Point Brands, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Altria Group has a beta of 0.42, meaning that its stock price is 58% less volatile than the S&P 500. Comparatively, Turning Point Brands has a beta of 0.97, meaning that its stock price is 3% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Altria Group and Turning Point Brands, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Altria Group	2	6	5	0	2.23
Turning Point Brands	1	1	4	0	2.50

Altria Group presently has a consensus price target of $71.00, suggesting a potential downside of 9.01%. Turning Point Brands has a consensus price target of $109.00, suggesting a potential upside of 62.23%. Given Turning Point Brands’ stronger consensus rating and higher probable upside, analysts clearly believe Turning Point Brands is more favorable than Altria Group.

Profitability

This table compares Altria Group and Turning Point Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Altria Group	34.51%	-330.66%	27.43%
Turning Point Brands	8.78%	11.35%	5.69%

Summary

Altria Group beats Turning Point Brands on 9 of the 17 factors compared between the two stocks.

About Altria Group

Altria Group, Inc., through its subsidiaries, manufactures and sells smokeable and oral tobacco products in the United States. The company offers cigarettes primarily under the Marlboro brand; large cigars and pipe tobacco under the Black & Mild brand; moist smokeless tobacco and snus products under the Copenhagen, Skoal, Red Seal, and Husky brands; oral nicotine pouches under the on! brand; and e-vapor products under the NJOY ACE brand. It sells its products to distributors, as well as large retail organizations, such as chain stores. The company was founded in 1822 and is headquartered in Richmond, Virginia.

About Turning Point Brands

Turning Point Brands, Inc., together with its subsidiaries, manufactures, markets, and distributes branded consumer products. The company operates through three segments: Zig-Zag Products, Stoker’s Products, and Creative Distribution Solutions. Zig-Zag Products segment markets and distributes rolling papers, tubes, finished cigars, make-your-own cigar wraps, and related products, as well as lighters and other accessories under the Zig-Zag brand. The Stoker’s Products segment manufactures and markets moist snuff tobacco and loose-leaf chewing tobacco products under the Stoker’s, Beech-Nut, Durango, Trophy, and Wind River brands. Its Creative Distribution Solutions segment market and distribute other products without tobacco and/or nicotine to individual consumers through VaporFi B2C online platform, as well as non-traditional retail through VaporBeast. In addition, it markets and distributes cannabis accessories and tobacco products. The company sells its products to wholesale distributors and retail merchants in the independent and chain convenience stores, tobacco outlets, food stores, mass merchandising, drug store, and non-traditional retail channels. The company was formerly known as North Atlantic Holding Company, Inc. and changed its name to Turning Point Brands, Inc. in November 2015. Turning Point Brands, Inc. was founded in 1988 and is headquartered in Louisville, Kentucky.