Last Updated: 08 Nov 2024
Executive Summary
Vector Group Ltd. (VGR) is a tobacco company that manufactures and sells cigarettes in the United States. The company has a market capitalization of $2.36 billion and trades on the NYSE. VGR has a trailing P/E ratio of 11.9 and a forward P/E ratio of 11.81. The stock is currently trading at $14.99, below its 52-week high of $15.33 and above its 52-week low of $8.99.
Company Overview
Vector Group Ltd. was founded in 1984 and is headquartered in Miami, Florida. The company's primary business is the manufacture and sale of cigarettes under the Liggett brand. VGR also has a minority stake in Douglas Elliman Realty, a real estate brokerage firm.
Fundamental Analysis
VGR's financial performance has been mixed in recent years. The company's revenue has declined in each of the past three years, from $1.04 billion in 2020 to $953 million in 2023. Net income has also declined, from $206 million in 2020 to $161 million in 2023.
Despite the decline in revenue and net income, VGR's profitability metrics have remained relatively stable. The company's gross profit margin has been in the mid-40% range in recent years, and its operating margin has been in the low-40% range. VGR's return on assets and return on equity have also been relatively stable, in the low-20% range and 0%, respectively.
Technical Analysis
VGR's stock price has been in a downtrend since early 2023. The stock has broken below its 50-day and 200-day moving averages, and it is currently trading near its 52-week low. The relative strength index (RSI) is also in oversold territory, which suggests that the stock could be due for a bounce.
Short Term Outlook
The technical analysis suggests that VGR's stock price could be due for a bounce in the short term. However, the company's fundamentals are weak, and the long-term outlook for the tobacco industry is uncertain. As a result, investors should be cautious about buying VGR stock at this time.
Long Term Outlook
The long-term outlook for VGR is uncertain. The tobacco industry is facing a number of challenges, including declining smoking rates, increased regulation, and competition from e-cigarettes. As a result, it is difficult to say whether VGR will be able to sustain its current level of profitability in the long term.
Analyst Recommendations
The analysts who cover VGR are divided on the stock's outlook. One analyst has a Strong Buy rating on the stock, while another has a Buy rating. The remaining analysts have Hold ratings. The consensus price target for VGR is $16, which is above the current stock price of $14.99.
