StockCall Scans Altria and Lorillard: Selling Prices Hike, is it a Solution for the Cigarette Makers?

 StockCall Scans Altria and Lorillard: Selling Prices Hike, is it a Solution
                          for the Cigarette Makers?

PR Newswire

LONDON, February 12, 2013

LONDON, February 12, 2013 /PRNewswire/ --

The United States cigarette industry faces a number of challenges that have
adversely affected the growth outlook for companies operating in this sector.
These have led to a shrinking market size of cigarette sales by volume over
the past years, and this trend could continue unless the main industry leaders
find apt solutions to the current problems.AltriaGroup Inc.(NYSE:MO),
Lorillard Inc. (NYSE:LO) andother major industry giants have resorted to
increasing cigarette prices to counter declining revenues. StockCall has taken
an interest in these companies and you can now sign up to download the free
technical research on AltriaGroup and Lorillard at 

Key threats to the Cigarette Industry

Restrictions already imposed by the FDA under the Family Smoking Prevention
and Tobacco Control Act (the "FSPTCA") enacted in June 2009; actual and
proposed excise tax increases; bans and restrictions on tobacco use imposed by
governmental bodies and private establishments; other illicit trade practices,
including the sale of duplicate low quality tobacco products by third parties;
and most crucial of all the increasing health awareness are all key threats to
the industry. In addition, companies have damaged their brand equity and
hindered revenue growth in the last few years. However, due to heavy brand
loyalty the cigarette industry has extremely low price demand elasticity.

Earnings Figures -AltriaGroup

Cigarettes sales constitute 70% of the total revenue for Altria Group and
smokeless products constitute 16% roughly. Altria Group reported revenue
figure of $24 billion and an adjusted EBITDA figure of $7 billion in 2012. The
less sensitivity is likely to keep the revenue forecast in-line, even though
unit sales are likely to decline. The stock however seems on a bullish run.
Sign up today to read the free research report on AltriaGroup Inc. at 

Earnings Figures - Lorillard

The rise in net income in the third quarter broke a streak of two consecutive
quarters of year-over-year profit declines. In the third quarter, net income
for Lorillard increased by 6%, while the figure dropped 2.4% in the second
quarter and 10.1% in the first quarter. The company reported revenue increase
for two quarters in a row. In the most recent quarter, sales rose 2.4%
year-over-year to $1.66 billion. The quarter prior to that that, sales grew by
2.3%. Register to download the free technical analysis on Lorillard Inc. at 

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