Jefferies Is 'Very Bullish' On Philip Morris's E-Cig Growth

Jefferies analyst Owen Bennett’s key takeaway from Philip Morris International Inc. PM investor day was the company’s optimism on e-cigarette growth in coming years. The firm increased their price target for Philip Morris from $96 to $99 and maintained a Hold rating.

In the general market, Jefferies expects exponential growth in the e-vapour industry in coming years once a market share is acheived, and expressed that it will have important implications in both sector and company valuations.

”Positioning within this space will become increasingly important with PMI leading the way at present,” said Bennett.

According to Bennett, after e-vapour gains a 2-3 percent share, growth can be exponential.

“We expect similar trends in the US once heat not burn is introduced,” said Bennett. “Accelerated IQOS growth could impact cigarette share of competition.”