SWMAY - Swedish Match: Strong Smokefree Beneficiary On Sale At 18.6x P/E
- Swedish Match shares have started falling again, despite last week's end of the U.S. "nicotine tax" proposal, its biggest tail risk.
- This is an opportunity to buy one of the stocks benefiting the most from the shift from cigarettes to Reduced Risk Products at just 18.6x P/E.
- Recent news has been positive: peers point to a favourable market; a rising USD adds to EBIT; Omicron is not a threat to Swedish Match.
- The recent correction is just part of the stock's volatility; it went through multiple 15%+ corrections in the last 5 years as it rose 138%.
- With shares at SEK 68.68, we expect a total return of 84% (23.0% annualized) by 2024 year end. The Dividend Yield is 2.2%. Buy.
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Swedish Match: Strong Smokefree Beneficiary On Sale At 18.6x P/E