Can Altria's Smoke-Free Push Finally Drive Long-Term Growth?

Altria Group, Inc.’s MO smoke-free strategy is increasingly centered on nicotine pouches, with on! PLUS emerging as a key part of that effort. In the second quarter of 2026, Helix expanded on! PLUS to about 120,000 stores, covering roughly 90% of nicotine product volume. The rollout is being supported by a broader retail program and additional line extensions.

The underlying category is also expanding. In the second quarter, the nicotine pouch category grew 8.1 share points and represented nearly 60% of the total oral tobacco category. For on!, reported shipment volume was 49.9 million cans, down 4.2% year over year, although first-half shipment volume rose 5.1%. The company attributed the second-quarter comparison partly to trade inventory movements and promotional activity in the prior-year period.

Retail performance offered another measure of the rollout. On! retail share reached 8.6% in the second quarter, up 0.8 percentage points sequentially and 0.3 percentage points from a year earlier, with the gain driven by on! PLUS. The next phase involves expanding product choice. 12-milligram on! PLUS shipments resumed in three states during the quarter, with national expansion planned for the third quarter. Additional flavors across 6-milligram, 9-milligram and 12-milligram strengths, starting with Blueberry Mint and Mango Pineapple, are planned for the fourth quarter.

Together, these developments show a smoke-free strategy built around wider distribution, a growing nicotine pouch category and a broader on! PLUS offering.

MO’s Nicotine Pouch Strategy Evolves Alongside PM and TPB

Philip Morris International Inc. PM is also expanding its smoke-free portfolio through nicotine pouches, with ZYN now available in 60 markets. In the second quarter of 2026, Philip Morris reported ZYN shipments rose 1.8% to 2.9 billion pouches, while new 9mg and 11mg ZYN ULTRA variants began shipping. Philip Morris plans additional 1.5mg and 8mg dry variants in the third quarter.

Turning Point Brands, Inc. TPB is also expanding its smoke-free portfolio through nicotine pouches, with Modern Oral net sales up 128% year over year to $68.4 million in the second quarter of 2026. While Modern Oral accounted for 48% of total revenues, up from 26% a year earlier, Turning Point Brands expanded retail distribution for FRE and ALP. Turning Point Brands expects chain-store count to increase 70% year over year by year-end.

Altria’s Price Performance, Valuation & Estimates

Shares of Altria have fallen 0.4% in the past three months against the industry’s growth of 5.1%.

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From a valuation standpoint, MO trades at a forward price-to-earnings ratio of 11.81X, down from the industry’s average of 15.55X.

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The Zacks Consensus Estimate for MO’s 2026 and 2027 earnings implies year-over-year growth of 4.8% and 3.2%, respectively.

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Altria currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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