Investing 102

[GregWeld]

Altria (MO), maker of cigarettes and other tobacco products, shifted all its ownership of Philip Morris International to shareholders. If you owned Altria on March 19, 2008 you were given shares of Philip Morris International on March 28, 2008.Shareholders received one share of Philip Morris International for every share of Altria they owned.



Lance --- Go back and refigure your MO scenario If you'd just bought them the first day they traded as separate companies (because we know those costs and dates).


We know Altria closed at $22.20 on March 31,2008 the first trading day after PM was split off. That day, Philip Morris International closed at $50.58. The value of the two stocks together on that date was $72.78

Today -- the two stocks combined trade for $122.34


In March of 2008 PM paid .46 a quarter -- today it pays .94
In March of 2008 MO paid .32 a quarter -- today it pays .48

So, just quickly -- since 2008 you had a cost basis of $72.78 and you're now picking up a 1.42 per quarter or $5.68 per year. The dividend is now paying you 7.80% based on your cost. AND you have a $49.56 unrealized long term capital gain. That's a 68% capital gain so far.

What part of that is hard to grasp?



5 year TOTAL RETURN on PM --- 152%

5 year TOTAL RETURN on MO --- 229%


I don't know - maybe it's just me…. The way I FIGURE IT… it might be part of why I'm sitting pretty and retired and running my race cars and hot rods… (forget that we were LUCKY AS HELL to begin with - I still have to manage that).