For the socially irresponsible among us (myself included), a smoke is one of the few guilty pleasures we're still allowed, though under very controlled circumstances these days. However, that's not so much the case in the rest of the world.
Imperial Tobacco Group, the fourth largest tobacco distributor in the world, has a global distribution network of lower cost brands of cigarettes, tobaccos and cigars. And since they are not primarily exposed to the changing tastes and habits of the North American markets, they continue to see good growth. In the first quarter of this year they saw their operational profits up 11% and continue to pay a strong dividend.
Anyone unopposed to profiting from a societal ill, ITY continues to be a solid long term play.
Update (5/11/07) . . .There is a blurb in todays Financial Times discussing the fact that ITY is taking its time in deciding whether or not to up its bid for Altadis. I'm encouraged by this because amid the current flurry of M&A, Imperial is actually taking its time determining whether or not Altadis would be a good fit (it would) and what its true value is. I believe the sign of strong management is the making of informed decisions, rather than jumping head long into the action.
Regardless of whether Imperial, or its competitor CVC consummates this deal, investors will at least know that Imperial made the best decision possible given the information available.
I continue to consider ITY a solid long term play, regardless of what most analysts may say.
$86.86 (05/11/07)
