Would it be insane to buy shares of a company selling a product harmful to the respiratory system during a pandemic with a virus that also impacts the respiratory system? It turns out…no. PMI’s Q1 report came out, and their numbers look good. EPS up by 34.5%. Cigarette sales only went down by 1.2%, but their IQOS unit went up by 6.6%. This is good news as cigarette sales were already on a downward trend and PMI is focused on their IQOS heated tobacco products for their future. Their operating income increased by 36% during this time. PMI also posts an eye watering 6.5% dividend yield, something every investor would look for during volatile times.
There are some risks however. PMI is a US company that generates their entire revenue outside of the US. Currency fluctuation, some currencies have devalued as much as double digits against the dollar. PMI will need to hedge during this time to cover their translation exposure from currency.