Solid Earnings per share numbers mask a serious problem

Why own any stock unless it pays dividends. While the S & P 500 and the tracking ETFs, SPY (SPY), brought together more than 20% of year lows last year, and stocks like Apple (AAPL) are more than 30% this year, several sectors have shares were better than a stock dividend for last year. Over the past few years’ stocks of tobacco has consistently been one of the most effective and popular dividend shares on the market. The largest and most popular tobacco stocks Altria (MO). Altria reaches almost 50% last year, and this company is consistently one of the most efficient stock market in general, the past few years. That's why I thought the last receipt of the company was so interesting. I have repeatedly recommended that tobacco stocks over the past year, including recommended investing in Lorillard (LO) in the seventies in my first article about the search for alpha more than a year ago. Altria traded today in the back of 21x earnings and nearly 15 times average earnings estimates for these years. However, while the cash flow of Altria remains strong, the company was virtually no growth in the past year, and companies with more than 80% of its net profits to pay dividends and repurchase shares. That's why I question the last updates in a statement. Altria recently reported 1.5% decline compared to the year of delivery, taking into account the impact of trade on the stock, and the company reported earnings per share growth of about 7-8%. Management is guided by the probability of earnings per share of $ 2.19, $ 2.23 in 2012, and analysts expected. In addition, the company announced a new $ 400 million a year savings program and disclosed that management purchased approximately $ 66 million in shares at a price of about $ 32.40 per share in the first quarter. While Altria top and bottom line numbers were quite solid, I think, a deeper analysis of the recent volume and price trends are alarming for this industry leader. The minimum annual drop in Altria in total shipments of cigarettes, of course, hard, until now the performance of premium brands like Marlboro was poor. Although the Marlboro brand market share in 0,2%, Marlboro delivery fell nearly 1%, net income from the delivery of Marlboro fell, and premium brands of cigarettes have seen about 9% decrease in volumes. Altria to stabilize the shipment numbers have been largely achieved with a company that provides significant discounts and the company increased discount brands on the market. Altria reported that the company's core brand at a discount, L & M, saw 24% growth last quarter. In conclusion, while the acquisition of UST by Altria and the situation of SAB Miller, as well as companies of Saint-Michel franchise wine and John Middleton brand, give this company some of the key outputs of cigarette revenue department. However, Altria gets more than 80% of total revenue from cigarettes, and companies are increasingly forced to use cheaper brands of cigarettes to compensate for the loss of market share from the competition with discount cigarettes, offered by competitors, Lorillard (LO) and Reynolds (RAI). The operating margin for Altria in almost 42% was very strong in the last quarter. Nevertheless, the company is debt to equity ratio of more than 350%, and using the balance control to inflate the likelihood of long-term return on equity of the company. Altria only about 6x coverage rate of interest payments, and the company's debt is trading at 5-7%. If the interest rate will increase slightly, and the company continues to sell to get more discount brands, the growth of the industry leaders and the region may face significant pressure. Disclosure: I have no positions in any stocks mentioned, and does not intend to initiate any positions within the next 72 hours.

Who wants a dead tobacco business in Africa?

In recent weeks, growing debate over the dynamics of the tobacco business in Africa, with sustained interest in the fate of the country's cultivation of tobacco, tobacco companies of the future for the production of and burden of the tobacco epidemic in the region that have stimulated so much media coverage. Across the region, it was more than 100 media in print, radio and television, presenting alternative views, and arguments against and in favor of the tobacco business. The campaign intensified among those who favor a balance between business and health around tobacco use, and the Framework Convention of the World Health Organization's Tobacco Control (FCTCC) on the one hand, and the tobacco industry on the other hand, questions have been raised that require further investigation. In May this year, the face of the campaign has changed at the end of the International Tobacco Growers Association meeting with Antonio Abrunhosa, CEO of ITGA urge to resist tobacco lose their livelihoods, creating a form of motion to oppose the WHO FCTC in the draft report on articles 17 and 18, which looks on the cultivation of tobacco in relation to the provision of economically viable alternatives. In a press statement released at the end of the meeting ITGA Antonio said the economy of the region are now under threat because of this "new form of imperialism," Health officials have no experience in agriculture. "Not having anything to show for their efforts to find alternatives to growing tobacco, they are moving in the direction of the government say to make it impossible for farmers growing tobacco, regardless of the impact on the millions of jobs." Such a statement, compared with the fact that most African countries are still developing, an ideology that is bent to reduce the livelihoods section of the economy, if it is, and based on the WHO FCTC will be considered as completely unfounded and beyond reach. It also leaves many questions raging. Francois van der Merwe, chairman of ITGA Africa, further sustained this argument when he said that the decision makers within the FCTC has moved beyond its original intent to help find an alternative to tobacco crops. "This transition occurs with complete disregard to the fact that tobacco is one of the few crops that provide a steady income for many families in the region." In a very quick response from a consortium of tobacco control in Africa, the African coordinator of the Framework Convention Alliance (FCA), Mr. Armstrong described the TIH Ntiabang ITGA statement as "the tactics of the tobacco industry," adding that the draft article referenced ITGA is to provide an alternative to tobacco, and is not about forcing farmers to leave their jobs. He said: "We regard the statement Antonio Abrunhosa, CEO of the International Tobacco Growers Association (ITGA), because it is misleading and a deliberate attempt to raise a protest against the treaty, WHO, using tobacco." The big question is, who wants to tobacco business is dead? What does this all the FCTC? Is this a "complete disregard" for a sustainable income for many in the region, as described by Francois van der Merwe? According to WHO, tobacco is the main cause of global death and disease. Tobacco use is responsible for 1 in 10 deaths of adults, and if current trends continue, it will kill more than 8 million people a year by 2030. Up to half of the more than 1 billion smokers worldwide will die prematurely from tobacco-related diseases. Faced with the devastating effects of the tobacco epidemic, world leaders in 2003 adopted the WHO Framework Convention on Tobacco Control (FCTC), a binding international treaty that is currently in 174 countries as parties, as well as the European Union, accounting for nearly 90 percent of the population the globe. FCTC parties to set up various working groups for detailed study of specific issues including sustainable alternatives to tobacco growing, known as Article 17 and 18 working groups that are open to all parties to the FCTC and now includes large sections of the countries where tobacco including India, Brazil, European Union, Turkey and the 13 African countries (Burkina Faso, Cameroon, DR Congo, Djibouti, Ghana, Kenya, Madagascar, Mali, Nigeria, Rwanda, Senegal, Tanzania, Zambia). The focus of this article was the need to improve the difficult economic and social conditions of many of the tobacco manufacturers and workers. The background to this ongoing debate on the business economics of tobacco and the FCTC in Africa, the working group has recently completed a draft report to be presented at the Conference of the Parties (COP) in November 2012. In contrast to the statements ITGA, and subsequent reports in the media, this draft report does not call for a ban on tobacco and tobacco farming, and he was not forced to leave their tobacco farmers' livelihoods. The report considers as the main goal should be to identify ways to assist farmers who are interested in alternatives to tobacco growing, which promises high returns, but often do not deliver them. In practice, the leaf tobacco companies and cigarette manufacturers to provide loans to farmers at the entrance and equipment that keeps them in poverty and must in many cases. The Working Group notes that, as the world's population continues to grow and the implementation of the FCTC is just beginning in many countries, it is unlikely that the demand for tobacco leaf will fall substantially over the years. He also noted that even when the FCTC-related decline in demand for tobacco leaves become visible in the transition to a more economically viable alternative products, they will slowly, providing a long transition from growing tobacco. These facts were not presented as arguments in the ITGA, may verify the statements of Mr. TIH, describing a press statement ITGA as misleading. It should be recalled that in 2010 had a similar campaign ITGA, on the eve of the fourth session of the COP in November 2010. In a press release August 31, 2010 ITGA said, "... If the WHO introduced the ban on tobacco ingredients are mixed will have disastrous consequences for many African countries, including many of its members. Tobacco growing is crucial to the economies of some of the poorest countries in Africa. These guidelines will be too crippled their economy and as a result of hundreds of thousands of African tobacco farmers losing their livelihoods. " Nevertheless, all the recommendations proposed in the Constitutional Court in 2010 - including ITGA specifically objected - were adopted at the meeting, and the doom and gloom predicted the tobacco industry did not happen. In fact, recent data show that tobacco production, and prices in countries such as Zimbabwe and Malawi in 2012 compared to 2011. Although, ITGA has positioned itself as a nonprofit organization that works to advance the cause of millions of tobacco manufacturers in the world, it is important to note that the ITGA was established manufacturers of cigarettes, and still depends on their financial support. Interest ITGA can therefore not be separated from the tobacco industry. The focus of the industry continues to prevent any tobacco control measures that may impede their business: connecting a new generation of smokers, ignoring the facts and prefer to use the mood of tobacco farmers to get the ear of the government tobacco-growing country, and media attention . It should be noted that the FCTC be a global agreement is not an order, and any recommendations contained in the final report of the Articles 17 and 18 of the Working Group should be to achieve consensus among the 175 Parties to the FCTC, including tobacco growing out of them before they are adopted by the COP in November. After that, the parties will decide whether to accept or reject them. According to the Framework Convention Alliance (FCA) in Geneva, "one of the biggest fears of the tobacco industry that in November of FCTC Parties shall agree on guidelines for governments to use to make taxes on tobacco products. Has long been known that an increase in cigarette prices in including through taxes, is the most effective way to reduce consumption. Instead of talking about the enormous health gains to be made by raising taxes, the industry prefers to deflect attention away from rehashing old horror stories about the faceless bureaucrats of the UN, which cover eyes to the lives of poor farmers. "

Tobacco Free on Sunday

Tobacco users in government office buildings managed by the Department of Central Services - including the Capitol - to get an early jump on how to avoid smoking or chewing while you work. Executive Order Governor Mary Fallin in February does not take effect until next month, but effective Sunday, 18 buildings in the capitol complex and state office buildings in the city of Tulsa to be Tobacco Free Initiative, said John Morrison, administrator of the Central Services Department.

"We just decided to go ahead and do it," said Morrison. "There was nothing to prevent the movement of the Agencies that before." The mood in the smoking room in the basement of the Capitol was a grim Friday the last day of a room with no windows were open to smokers who work in the building. Handwritten note on a piece of paper attached to the wall, as she announced the governor issued to "the end is near." Friday, someone crossed out the word "next" and replaced it with "now". Five smokers in a small room that can accommodate up to 13 people on Friday afternoon. One smoker said he would try to do without smoking in the workplace, while others did not know where they go to smoke. One woman, who works at the Capitol, said that she plans to go round the building and smoke. Fallin announced its proclamations during her State of the State address on February 6, to begin four months of the session of the legislature. Implementation will take place no later than six months after its proclamation, and on August 6, when the tobacco products in all public and leased properties and state-owned and leased buildings and vehicles will be prohibited. Her announcement drew applause, but the groans were heard seconds later, the House of Representatives chamber, when it announced a ban would mean the closure of the smoking room of the Capitol for legislators and staff. The governor planned to reconstruct the building at no cost to the state in a small fitness center. The state received a grant from the tobacco settlement trust and Oklahoma Hospital Association has agreed to match it. "It is planned that currently use more space than provided in the smoking room," said Alex Weintz, communications director in Fallin. "This smoking room will no longer be used as a smoking room. Although we do not believe that it will be used in the future, will likely have to be decontaminated first. "While the governor's ban on the use of tobacco in public places comes into force on 6 August agencies have the right to a tobacco-free policy before," he said. Fallin said the goals of the tobacco ban are to protect the health of workers and people attending public properties. It is also intended to reduce a major factor in increasing health care costs for state employees, reducing absenteeism and improving employee productivity, according to the governor's office. The ban is expected to save the state $ 5.2 million per year. Smoking causes a number of death in Oklahoma and the United States, said the governor's office. Fallin made the ban effective for several months from now, to give government officials time to consider the adoption of smoking cessation programs. Pet breeder of change Effective Sunday, the council was formed two years ago to regulate the commercial breeders have officially disbanded. The duties of the Council of Oklahoma commercial pet breeders are now borne by the State of Agriculture, Food and Forestry. Emergency regulations, establishing rules, fees, procedures and guidelines were approved late last month. In accordance with existing rules, only animal breeders with 11 or more females are subject to state regulation. Unspayed woman at least 9 months is considered to be breeding female. Many of the emergency rules are similar to existing rules on the model of care and treatment standards, U.S. Department of Agriculture. Emergency rules may take up to shortly after the legislative session in late May. Work will begin to develop a permanent rule in September or October. Sex Offenders The bill, passed last year, extending a ban on more than one sex offender living in a house or apartment to include mobile homes, and shall come into force on Sunday. Hands Up Ministries, a nonprofit organization that provides housing for more than 200 registered sex offenders in Oklahoma City mobile home parks, tried unsuccessfully in court to stop enforcement of the law, which makes about 90 residents to move. Hands Up Ministries wanted the judge to halt the execution of the law, could not yet determine whether it is the Constitution. Human rights Sunday also marks the end of the Oklahoma Commission for Human Rights, which was established nearly 50 years ago. The Human Rights Commission was established measure came into force in 1963, then-Gov. Henry Bellmon. The bill, passed last year, the place of his duties with the Office of the Attorney General, as part of the governor's plan to combine several agencies. Effective Sunday, the Office of Civil Rights in the Attorney General's office will handle the duties of the commission, which include complaints of discrimination in employment, housing and public accommodations based on race, color, religion, sex, national origin, disability or age. The Commission also accepts, maintains and reports on complaints of profiling based on race or national origin. Pseudoephedrine The bill aims to reduce the production of methamphetamine comes into force on Sunday. House Bill 2941 restricts the purchase of pseudo ephedrine and improved electronic tracking system of Oklahoma sales of the drug. Pseudoephedrine is a common ingredient in cold and allergy medicine that is used in the manufacture of methamphetamine. HB 2941 limits the procurement decongestant to 3.6 grams per day, or 15 tablets of 24-hour pseudoephedrine. Monthly purchases are limited to 7.2 grams, compared with 9 grams, and annual purchases should not exceed 60 grams, less than 108 grams. It establishes a system, regardless of public procurement can be traced with in public procurement. It also allows pharmacies to charge for the service, someone who can not legally buy the product tries to do it. Tracking system to block someone who over the limit on the purchase of the product. Promissory notes with the support of prosecutors, who demanded a prescription to purchase pseudoephedrine failed to win legislative approval this year. Fiscal year Sunday and the beginning of fiscal year 2013 for the state. $ 6.8 billion budget allocated by the legislature formally enters into force. That's about 3.1 percent more than the $ 6.6 billion, lawmakers allocated for 2012 fiscal year.

California taxes on tobacco

The tax increase after California’s initiative consists in paying for cancer researcher. The opponents of Proposition 29 led with more then 29.000 votes. The press delaminated the region where more then 106.000 votes. Tobacco companies managed by Philip Morris, pushed the campaigns opposition, using millions of dollars for ads.

On Monday, the absence of Prop 29 was from 50, 5% to 49, 4%. The strongest support for San Francisco area and for some conservative places like Southern California and Inland Empire opposed it. If the measure will pass, California would have to pay only some taxes for tobacco products, nearly $ 1.90 per package. Supporters affirmed they will come back. "It was so close, I think it's worth another try," said Stan Glantz of the University of California at San Francisco Center for Tobacco Control Research and Education. "I think it would be unsupported if Philip Morris and Reynolds get away with it." He affirmed that the cigarettes tax proponents may turn to the Legislature, but lawmakers ignored attempts for tobacco products tax rising. The campaign will be waiting until will be known the number of votes for to declare the victory, the press-Beth Miller said. Opponents of the measure have raised $ 50 million to combat it, a huge sum even by the standards of California. For comparison, Jerry Brown has spent about $ 37 million in 2010, his successful attempt to become governor of California. Wisconsin Governor Scott Walker and his allies spent $ 49 million to discourage him recall task on June 6. Armstrong and the Coalition for Tobacco Control group raised about $ 14 million to support the measure, including $ 600,000 from New York City Mayor Michael Bloomberg. In a statement Tuesday, Lance Armstrong Foundation president Doug Ulman formulated a question of life and death. "The defeat of this vitally important initiative is a real tragedy," he said. "Big Tobacco lied to voters to protect their income and spent $ 51 million to ensure it can continue to sell their bad products in California for the children." While the price increases on tobacco products is a unique way to reduce smoking, especially among teens, the campaign ads supporting the tobacco companies are focused on pocketbook issues. Announcements said the money would be raised through the tax in California, but not necessarily be in the study. The campaign also grew the specter beyond the control of the bureaucracy to be created to oversee the collection and distribution of money. Some big newspapers, including The Los Angeles Times, spoke out against the measures, expressing general help for such a sin tax and reluctance to side with the tobacco companies. They argued that the proceeds should go directly to the state, which is now worth $ 15.2 billion deficit. As a result, the 2008 recall of California cigarette tax measures that have led to a large election before the beginning of the tobacco companies spent $ 66 million to defeat her ad with doctors. It was unclear Friday whether the failure of Prop 29 were narrow defeat state ballot measure in California history. Previously, the closest vote in the last two decades has been on the school bond measure 1B in 1994, which were unable to 49.6% to 50.4%, according to Secretary of State Spokeswoman Shannan Velayas. The second was a best friend of the measure of tobacco tax, which was 50.5% to 49.5% in 2000. California was once at the top of smoking taxes and restrictions, but we know care about their health, the State did not raise taxes on tobacco products since 1999. Missouri voters are expected to weigh in on tax increases on tobacco products in December, and similar taxes, which go through the legislative process in Rhode Island, Massachusetts and Illinois. A big part of recent tobacco taxes across the country have been approved in the state houses. Copyright from 2012 Associated Press declared that all rights were reserved. This material may not be published, broadcast, redistributed or rewritten.