Philip Morris International Inc. (NYSE: PM) reported second-quarter results Thursday that prompted Cowen drop its bullish stance on the cigarette maker.
Cowen’s Vivien Azer downgraded Philip Morris from Outperform to Market Perform with a price target lowered from $99 to $85.
Philip Morris’ earnings report was accompanied with a downward revision to its earnings guidance, which is clearly disappointing to investors, Azer said in the downgrade note. (See the analyst’s track record here.)
The company does deserve some credit for the transparency in its revision, the analyst said. Cowen adjusted multiple assumptions related to the IQOS smokeless tobacco device:
- Total 2018 IQOS shipment volumes were lowered from 45.5 billion to 39.5 billion.
- Sequential share losses in Japan in the third and fourth quarter are projected at 40 basis points versus 30-basis point losses in the second quarter.
- Flat performance in South Korea in the third and…