-- Philip Morris International's (PM) Q1 results are expected to be broadly in line, with UBS Securities forecasting a slight earnings per share beat versus consensus, as lower US ZYN volumes are offset by stronger pricing and cost factors.
The brokerage said in a Thursday note that while Q1 EPS is about $0.01 ahead of consensus, the key focus is on Fiscal 2026. Softer US ZYN volume trends, potential delays to FDA approval of the ZYN Ultra offering and macro pressure from the Middle East and Asia could weigh on organic sales growth.
The Middle East and Asia, accounting for nearly 30% of Philip Morris' revenue, are facing conflict-related impacts and higher energy costs. The investment firm expects 2026 Group volumes to decline 1.9%, with combustibles down 4.2% versus the consensus of a 3.9% decline. Smoke-free volumes are expected to rise 5.6%, versus consensus growth of 6%.
The brokerage now expects 2026 EPS growth of 11.6% to $8.42, compared with the Street consensus of $8.46. UBS estimates IQOS and US ZYN volumes for Q2 at 41.6 billion and 184 million, respectively. It anticipates organic sales growth of 4.0% and EPS of $2.13.
UBS maintained a neutral rating on Philip Morris and lowered the price target to $168 from $181.50.
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