Tobacco Names Get Smoke in Their Eyes

Philip Morris (PM) was down about three percent at one point Wednesday. The cause? What we knew all along: people are smoking less. We learned exactly how much less on Wednesday.

Cigarette consumption is declining at a rate of 2 to 3% globally (according to PM's own figures), 7 to 8% in Europe and a whopping 9 to 11% in Russia. Call me clueless, but I fail to see how PM and related stocks are a buy when their customers are literally disappearing. If automakers were selling 10% fewer cars annually, you would not buy Ford (F) and General Motors (GM). If Hewlett Packard (HPQ) was selling 10% fewer computers, you would not buy HPQ. So why is it that we still love the tobacco names?...439 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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