NYSE: PM · Tobacco
Philip Morris International
Philip Morris International (PMI), based in Stamford, Connecticut, sells cigarettes such as Marlboro outside the U.S. and is shifting to smoke-free products: IQOS heated tobacco, ZYN nicotine pouches (which it calls the leading smoke-free brand in the U.S.) and e-vapor. In 2025 net revenues rose 7% to $40.6 billion, of which smoke-free products were $16.9 billion (41%) and combustible tobacco $23.8 billion, and net earnings were $11.3 billion. Its share of the international cigarette and heated tobacco market (excluding China and the U.S.) was 29.2%. PMI pays out most of its earnings as dividends ($8.6 billion in 2025) and has negative stockholders' equity because of borrowings and past buybacks. From 2026 it reports three segments: International Smoke-Free, International Combustibles and U.S.
Last updated
Analysis last edited: November 1, 2026 · Financial data fetched: November 1, 2026 09:31 (SEC EDGAR) · Source 10-K filed: February 6, 2026
Built on10-K FY2025 · filed 2026-02-0610-Q (quarter ended 2026-09-30) · filed 2026-10-23Proxy statement (2026)
Next update expectedAfter FY2026’s 10-K is filed (roughly 60–90 days after fiscal year end (sooner for larger filers)), financials and analysis will be refreshed.
01
At a glanceFrom SEC data
Eight headline measures, each placed among the companies covered on this site.
- Revenue growthCAGRSmooths out year-to-year swings into "grew X% a year on average." Makes growth pace comparable across companies of very different sizes.
- 7.2%
- Operating marginOperating marginHow many cents of operating profit are left per dollar of revenue. Reflects pricing power and cost structure.
- 36.6%
- ROIC minus WACCROIC − WACC spreadThe difference between ROIC and WACC. Consistently positive implies value creation; consistently negative implies value destruction.
- +27.5 pts
- Net debt ÷ EBITDAEBITDAOperating income with D&A added back. A rough proxy for cash-generating power that’s less distorted by capital intensity, depreciation method, or financing/tax differences than net income.
- 2.4x
- Cash conversionOperating CF ÷ net income (cash conversion)How much of reported profit shows up as actual cash. 1x or higher means profit is backed by cash.
- 1.08x
- Dividend raisesDividend per shareTotal annual dividend paid per share (sum of all declared payments for the year).
- 5 of 5
- P/E todayP/EShare price ÷ EPS — how many years of current earnings the stock price represents. This site uses the period-end figure as reported in the filing.
- 30.4x
- Betaβ (beta)How much a stock moves, on average, for a 1% move in the overall market. Above 1 means more volatile than the market, which raises the return shareholders require. This site computes it from about 2.5 years (roughly 130 weeks) of weekly returns, built from Yahoo Finance daily prices, regressed against an S&P 500 ETF (SPY) as the market proxy, then applies the well-known long-run mean-reversion adjustment (0.67 × β + 0.33) as the WACC default.
- 0.29
Higher than 41% of 372 non-financial companies
Average yearly growth over the years shown
Higher than 89% of 311 non-financial companies
Latest fiscal year (FY2025)
Higher than 93% of 311 non-financial companies
Return on capital above (or below) its estimated cost
Higher than 63% of 304 non-financial companies
Below 0 means more cash than debt
Higher than 13% of 349 non-financial companies
Operating cash flow ÷ net income
Years the dividend per share rose, of the last 5
Latest close 2026-11-04; trailing 12 months to 2026-09-30
Above 1 = moves more than the market
Each marker shows where this company sits among the non-financial companies covered on this site, not all listed companies (left = lowest, right = highest). A high position is not automatically good — for net debt ÷ EBITDA, higher means more debt. Details and formulas are in the sections below and in How to read this.
02
Valuation todayFrom SEC data
Price-based measures at the latest close, next to the same measures at the last fiscal year-end.
Share price$209.38close on 2026-11-04
Market cap$325.93B
- P/EP/EShare price ÷ EPS — how many years of current earnings the stock price represents. This site uses the period-end figure as reported in the filing. today
- 30.4x
- P/BP/BShare price ÷ book value per share. Below 1x means the market values the company below its accounting net worth. This site uses the closing price nearest the fiscal year-end and highlights sub-1x readings. today
- —
- EV/EBITDAEV/EBITDAEnterprise value (≈ market cap + interest-bearing debt − cash) as a multiple of EBITDA — roughly, "how many years of EBITDA to buy the whole company." Lower is generally viewed as cheaper, and it’s more comparable than P/E across companies with different debt loads or depreciation policies. This site excludes noncontrolling interests from the EV calculation. today
- 21.7x
- FCF yieldFree cash flow (FCF)Operating CF minus capital expenditures — cash generated by the business after funding its own investment, available for dividends, buybacks, acquisitions, or debt paydown. Acquisitions and securities purchases (also in investing CF) are not subtracted, so FCF can be positive in a year when total investing CF exceeds operating CF. today
- 3.3%
- Dividend yieldDividend per shareTotal annual dividend paid per share (sum of all declared payments for the year). today
- 2.7%
At FY2025 year-end: 22.1x
Earnings: trailing 12 months to 2026-09-30
At FY2025 year-end: —
Book value at FY2025 year-end
At FY2025 year-end: 17.2x
EBITDA for FY2025
At FY2025 year-end: 4.3%
Free cash flow for FY2025
Dividends per share for FY2025
“Today” uses the latest closing price (2026-11-04, Yahoo Finance daily closing prices) and shares outstanding at the last fiscal year-end. The rest of this page — including the financial table and ROIC vs. WACC — uses fiscal year-end prices. These are reference figures, not a judgment of whether the stock is cheap or expensive.
03
What changed since last earningsFrom SEC data
The latest reported quarter against the same quarter a year earlier, the balance sheet against the previous quarter-end, and what management said in its latest earnings release.
Quarter ended Sep 30, 2026.
- Revenue$10.85B → $11.44B (vs. a year earlier)↑ +5.5%$10.85B → $11.44B (vs. a year earlier)
- Operating margin39.3% → 42.5% (vs. a year earlier)↑ +3.2 pts39.3% → 42.5% (vs. a year earlier)
- Net income$3.48B → $3.31B (vs. a year earlier)↓ −4.7%$3.48B → $3.31B (vs. a year earlier)
- Diluted EPS$2.23 → $2.12 (vs. a year earlier)↓ −4.9%$2.23 → $2.12 (vs. a year earlier)
- Cash$6B → $6.68B (vs. previous quarter-end)↑ +11.4%$6B → $6.68B (vs. previous quarter-end)
Source: Form 10-Q ↗ (SEC XBRL). Long-term debt is the tagged long-term debt figure and leaves out short-term borrowings.
From the earnings release of Oct 21, 2026.
Management outlook • Issued
Forecasts reported EPS of $7.11–$7.26. Source sentence
Reported diluted EPS is forecast to be in a range of $7.11 to $7.26, at prevailing exchange rates.
Key changes
Net revenues up 5.5% to $11.4B. Source sentence
Net revenues increased by 5.5% (7.1% organically) to $11.4 billion, with growth across both smoke-free (up by 4.1%, 6.3% organically) and combustibles (up by 6.4%, 7.7% organically).
Reported EPS down 4.9% to $2.12. Source sentence
Third-Quarter Reported Diluted EPS declined by 4.9% to $2.12;
Adjusted EPS up 5.4% to $2.36. Source sentence
Adjusted Diluted EPS grew by 5.4% to $2.36; and by 5.8% excluding currency;
Written by AI. A line appears only if its figures and direction match the quoted sentence, which an automatic check confirms. Companies' outlooks are their own and may not be met. Read the release ↗
04
Company profileFrom SEC dataShow
- Legal name
- Philip Morris International Inc.
- Headquarters
- STAMFORD, CT
- Incorporated in
- Virginia
- Fiscal year end
- 12/31
- Exchange & ticker
- NYSE: PM
- Industry
- Tobacco
- CIK
- 1413329
- Website
- https://www.pmi.com/ ↗
Workforce (as of FY2025 year-end)
Employees
84,900
Source: Form 10-K (FY2025) cover page and business description
05
Earnings calendarFrom SEC dataShow
When the company reports each quarter: the quarter-end date, the day results were released, and when the 10-Q or 10-K was filed.
Next report
Q4 FY2026
Quarter end: December 2026. In past years, Q4 results were released 37–39 days after quarter end (Feb 6, 2026; Feb 6, 2025; Feb 8, 2024). No date has been announced in the sources this site uses.
Reporting pattern
- Fiscal year ends around December 31.
- Reports four times a year: three quarterly reports (10-Q) and an annual report (10-K) for Q4.
- Earnings releases came 21–39 days after quarter end over the last 12 quarters.
| Quarter | Quarter ended | Earnings release (8-K) | Report filed (10-Q / 10-K) |
|---|---|---|---|
| Q3 FY2026 | Sep 30, 2026 | Oct 21, 2026 (+21 days) | Oct 23, 2026 10-Q (+23 days) |
| Q2 FY2026 | Jun 30, 2026 | Jul 22, 2026 (+22 days) | Jul 24, 2026 10-Q (+24 days) |
| Q1 FY2026 | Mar 31, 2026 | Apr 22, 2026 (+22 days) | Apr 24, 2026 10-Q (+24 days) |
| Q4 FY2025 | Dec 31, 2025 | Feb 6, 2026 (+37 days) | Feb 6, 2026 10-K (+37 days) |
| Q3 FY2025 | Sep 30, 2025 | Oct 21, 2025 (+21 days) | Oct 24, 2025 10-Q (+24 days) |
| Q2 FY2025 | Jun 30, 2025 | Jul 22, 2025 (+22 days) | Jul 25, 2025 10-Q (+25 days) |
| Q1 FY2025 | Mar 31, 2025 | Apr 23, 2025 (+23 days) | Apr 24, 2025 10-Q (+24 days) |
| Q4 FY2024 | Dec 31, 2024 | Feb 6, 2025 (+37 days) | Feb 6, 2025 10-K (+37 days) |
| Q3 FY2024 | Sep 30, 2024 | Oct 22, 2024 (+22 days) | Oct 24, 2024 10-Q (+24 days) |
| Q2 FY2024 | Jun 30, 2024 | Jul 23, 2024 (+23 days) | Jul 25, 2024 10-Q (+25 days) |
| Q1 FY2024 | Mar 31, 2024 | Apr 23, 2024 (+23 days) | Apr 26, 2024 10-Q (+26 days) |
| Q4 FY2023 | Dec 31, 2023 | Feb 8, 2024 (+39 days) | Feb 8, 2024 10-K (+39 days) |
Source: SEC EDGAR filing history. Release dates are the dates the earnings release was furnished to the SEC on Form 8-K (Item 2.02), which is normally the day results are announced. For a quarter whose 10-Q or 10-K isn’t filed yet, the date is the latest Item 2.02 8-K since the previous report, which may be a preliminary or other results-related update. Fiscal years are labeled by the calendar year in which they end.
06
Flagship products & servicesSite analysis
Combustible tobacco
Marlboro and other cigarettes
Cigarettes sold in markets outside the U.S.
Smoke-free
IQOS (TEREA, HEETS)
Heat-not-burn devices and heated tobacco units.
Smoke-free
ZYN
Nicotine pouches from Swedish Match; the leading smoke-free brand in the U.S. per the 10-K.
Smoke-free
E-vapor
Vaping products.
From the Form 10-K, FY2025.
U.S., worldwide and country/regional share of flagship products/services
Only shares the company itself states (in its filings or press releases, sometimes citing a research firm) are shown. Scope and timing vary by figure — treat these as approximate.
Cigarettes and heated tobacco
International (excl. China and U.S.)
U.S. share
—
Not disclosedWorldwide share
29.2%
Company-disclosedTotal international share in 2025: cigarettes 23.4%, HTU 5.8%
07
Recent strategic focusSite analysis
Recent developments.
Nine months 2026
Net earnings attributable to PMI $8,568M versus $9,207M; diluted EPS $5.48 versus $5.89; operating cash flow $10.4B versus $7.5B.
Source: Form 10-Q (quarter ended 2026-09-30)
New segments
From 2026, three reportable segments: International Smoke-Free, International Combustibles and U.S.
Source: Form 10-K (FY2025)
CFO change
Massimo Andolina, President of the Europe region, became Group CFO on August 1, 2026, replacing Emmanuel Babeau.
Source: 8-K filed 2026-05-20
Debt actions
Issued $1.5B of notes in April 2026 and prepaid €1.0B of its term loan in June 2026.
Source: 8-Ks filed 2026-04-29 and 2026-06-29
Capex ÷ D&A (FY2025)
0.79x
Below depreciation — investment is being pared back
formulacapital expenditures ÷ depreciation & amortization
e.g.$1,569M ÷ $1,996M = 0.79x
termsCapital expenditures (capex) · Depreciation & amortization (D&A)
R&D-to-revenue ratio (FY2025)
1.9%
formularesearch & development expense ÷ revenue × 100
e.g.$756M ÷ $40,648M × 100 = 1.9%
M&A spend (6-year total)
$16.09B
Latest year: $0
Cash-flow-statement spending on acquisitions, net of cash acquired
Where the money goes, over time
Unit: $M. Capex went from $602M in FY2020 to $1.57B in FY2025
- Capex
- R&D
- M&A spend
formulacapital expenditures ÷ depreciation & amortization
termsCapital expenditures (capex) · Depreciation & amortization (D&A)
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-06
08
Key figures at a glanceFrom SEC data
FY2020–FY2025, 6 years.
Revenue (FY2025)
$40.65B
As reported in the 10-K
Revenue CAGR (5 years)
+7.2%▲favorable
formula(last-period revenue ÷ first-period revenue) ^ (1 ÷ years) − 1
e.g.($40,648M ÷ $28,694M) ^ (1÷5) − 1 = 7.2%
termsCAGR · ^ (exponent) · Revenue (net sales)
Operating margin (FY2025)
36.6%▼caution
-4.0pt vs. 5 years ago
formulaoperating income ÷ revenue × 100
e.g.$14,892M ÷ $40,648M × 100 = 36.6%
ROE (FY2025)
—▼caution
6-year average: —
As reported in the 10-K
P/B (FY2025 end)
—
Period-end (fiscal year-end) value, not today's P/B
EV/EBITDA (FY2025 end)
17.2x
formula(market cap + interest-bearing debt − cash and equivalents) ÷ (operating income + depreciation & amortization)
e.g.($249,688M + $45,134M − $4,872M) ÷ ($14,892M + $1,996M) = 17.2x
termsEV/EBITDA · Market capitalization · Interest-bearing debt · EBITDA · Depreciation & amortization (D&A)
Period-end (fiscal year-end) value, not today's multiple
- ▲
Revenue grew +7.2% a year over 5 years (strong growth)
From $28.69B in FY2020 to $40.65B in FY2025. The annualized rate (CAGR) makes it possible to compare growth pace across companies of different sizes.
- ▼
Operating margin declined: 40.7% → 36.6%
How much operating profit is left per $100 of revenue. It moved -4.0 points over 5 years — pricing power, cost control, and product mix all show up here.
- ▼
Equity ratio is -14.4% (relatively heavy reliance on debt)
The share of total assets funded by equity rather than debt. 50%+ is often read as low bankruptcy risk, though the right level varies by industry (real estate and leasing run lower, for instance).
- ▲
Free cash flow was positive in 6 of 6 years
Operating cash flow minus capital expenditures: the cash left over after funding the business’s own investment, available for dividends, buybacks, acquisitions, or debt paydown. A negative year can mean heavy investment, or weak core earnings — worth distinguishing.
09
Business modelSite analysis
Business Model Canvas
The whole company in nine blocks. Left side: how it delivers (partners, activities, resources, costs). Right side: who it serves and how it earns. Every entry comes from the company’s filings shown on this page.
08 · who helps
Key partners
No partners or suppliers named in the filings.
07 · what it does
Key activities
- Manufacturing cigarettes, HTUs and pouches
- Distribution through wholesalers and distributors
- Marketing to adult consumers within regulations
06 · what it draws on
Key resources
- About 84,900 people worldwide
- Leaf tobacco and manufacturing plants
- R&D (over $16B invested in smoke-free products since 2008)
02 · why customers buy
Value propositions
- Cigarettes and smoke-free products (IQOS, ZYN); competes on product quality, brand recognition and loyalty.
04 · how it keeps them
Customer relationships
- Brand loyalty and IQOS device ecosystems.
03 · how it reaches them
Channels
- Wholesalers, distributors and retailers outside the U.S.; ZYN in the U.S.
01 · who it serves
Customer segments
- Wholesalers, distributors and retailers
- Adult consumers
09 · where money goes
Cost structure
FY2025, share of revenue ($40.65B)
- Cost of revenue32.9%
- Research & development1.9%
- Other operating costs28.6%
Operating profit left: 36.6% of revenue. Depreciation & amortization (inside the costs above): $2B. Capital spending: $1.57B.
Source: Form 10-K income statement and cash-flow statement (SEC XBRL).
05 · how money comes in
Revenue streams
- Cigarette sales
- IQOS devices and HTUs (TEREA, HEETS)
- ZYN pouches and e-vapor
Value propositions, channels and customer relationships: Form 10-K (FY2025)
Manufactures and sells cigarettes, heated tobacco units (HTUs), oral nicotine pouches and e-vapor products in markets outside China and, for smoke-free products, in the U.S.; invests to move adult smokers to smoke-free alternatives.
01 what it draws on
Inputs & resources
- About 84,900 people worldwide
- Leaf tobacco and manufacturing plants
- R&D (over $16B invested in smoke-free products since 2008)
02 what it does
Activities
- Manufacturing cigarettes, HTUs and pouches
- Distribution through wholesalers and distributors
- Marketing to adult consumers within regulations
03 who it serves
Customers
- Wholesalers, distributors and retailers
- Adult consumers
04 how money comes in
How it earns
- Cigarette sales
- IQOS devices and HTUs (TEREA, HEETS)
- ZYN pouches and e-vapor
How the business makes money
- 2025 shipment volume 786.5 billion equivalent units, incl. 179.1 billion smoke-free.
- Smoke-free net revenues $16.9B (+15%).
- International market share 29.2% (cigarettes 23.4%, HTU 5.8%).
Government & regulation around the business
Non-market factors from the company’s filings: what governments and regulators fund, buy, set, approve or restrict, and which part of the flow above each one touches.
PMI is taxed and regulated country by country; Italy classified TEREA as cigarettes for excise tax.
Regulated prices & reimbursement
Excise classification
Italy classified TEREA consumables as cigarettes for excise tax, with a EUR 151M assessment.
Constrains the businessTouches: How it earnsSource: Form 10-K (FY2025)
Trade & export rules
Tariffs and trade rules
Subject to trade restrictions by the U.S., EU, Switzerland and UK.
Constrains the businessTouches: Inputs & resourcesSource: Form 10-K (FY2025)
Revenue by segment (2025)
Unit: $M — bar length = revenue, (%) = share of total company revenue
Combustible tobacco
23,794 (59%)Smoke-free
16,854 (41%)
Source: Form 10-K (FY2025) Net revenues by product category; total $40,648M. Reporting moved to three segments (International Smoke-Free, International Combustibles, U.S.) from Q1 2026.
10
Contract structureSite analysisShow
Short-term or spot sales carry different earnings quality than long-term or auto-renewing contracts — this shows how the company actually contracts with its customers.
11
Customers & suppliersSite analysis
Who the company sells to and buys from. Companies rarely name either, so named counterparties come only from the company's own filings and press releases; otherwise this lists the concentration figures the 10-K discloses.
Customers
Wholesalers, distributors and retailers.
Named by the company
What the filings disclose
Suppliers
Leaf tobacco growers and suppliers, and contract manufacturers.
Named by the company
No supplier is named.
12
Competitors & peersSite analysis
Competitors the 10-K names, and the peer group the company itself chose in its proxy statement. Nothing here is this site's own pick.
The 10-K describes competition from international and local tobacco companies and from products that circumvent regulations, without naming competitors.
Competitors named in the 10-K
Peer group the company chose
Compensation and TSR peer group (2026 proxy), from the proxy statement. Peers are companies the board considers comparable — for example when setting executive pay — not necessarily direct competitors.
19 global consumer products companies chosen for global presence, consumer focus and size.
- Altriasite ↗
- Kimberly-Clarksite ↗
- Anheuser-Busch InBevsite ↗
- Kraft Heinzsite ↗
- British American Tobaccosite ↗
- McDonald'ssite ↗
- Coca-Cola Companysite ↗
- Mondelez Internationalsite ↗
- Colgate-Palmolivesite ↗
- Nestlésite ↗
- Diageosite ↗
- PepsiCosite ↗
- Heinekensite ↗
- Procter & Gamblesite ↗
- Imperial Brandssite ↗
- Roche (Ventana Medical Systems)site ↗
- Japan Tobaccosite ↗
- Unileversite ↗
- Johnson & Johnsonsite ↗
Company names link to this site’s analysis where one exists; “site ↗” opens the company’s own website.
13
Six years of financialsFrom SEC data
Each chart's axis holds a single unit (never mixing dollars, %, and $/share). The table's per-period header links to the filing the numbers came from.
Revenue over time
Unit: $M
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-06
Profit over time (operating → net)
Unit: $M
- Operating income
- Pretax income
- Net income
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-06
Margins over time
Unit: %
- Operating margin
- Net margin
formulaoperating income ÷ revenue × 100
formulanet income attributable to the company ÷ revenue × 100
Cash flow over time
Unit: $M (below zero = cash went out)
- Operating CF
- Investing CF
- Free CF
formulacash flow from operations − capital expenditures
termsFree cash flow (FCF) · Cash flow from operations (operating CF) · Capital expenditures (capex)
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-06
Financial stability & capital efficiency
Unit: %
- Equity ratio
formulatotal equity ÷ total assets × 100 (as reported in the 10-K)
termsStockholders’ equity · Total assets
formulanet income ÷ average equity (beginning + ending, ÷2) × 100 (as reported in the 10-K)
termsNet income (attributable to the company) · Stockholders’ equity
Earnings per share (EPS) and dividend per share
Unit: $
- EPS
- Dividend per share
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-06
| Line item | FY202010-K on EDGAR ↗ | FY202110-K on EDGAR ↗ | FY202210-K on EDGAR ↗ | FY202310-K on EDGAR ↗ | FY202410-K on EDGAR ↗ | FY202510-K on EDGAR ↗ |
|---|---|---|---|---|---|---|
| Income statement ($M) | ||||||
| Revenue | 28,694 | 31,405 | 31,762 | 35,174 | 37,878 | 40,648 |
| Operating income | 11,668 | 12,975 | 12,246 | 11,556 | 13,402 | 14,892 |
| Pretax income | 10,953 | 12,232 | 11,634 | 10,450 | 12,199 | 13,880 |
| Net income (attributable) | 8,056 | 9,109 | 9,048 | 7,813 | 7,057 | 11,348 |
| Revenue growthcalc(this year’s revenue − last year’s revenue) ÷ last year’s revenue × 100 | — | 9.4% | 1.1% | 10.7% | 7.7% | 7.3% |
| Operating margincalcoperating income ÷ revenue × 100 | 40.7% | 41.3% | 38.6% | 32.9% | 35.4% | 36.6% |
| Net margincalcnet income attributable to the company ÷ revenue × 100 | 28.1% | 29.0% | 28.5% | 22.2% | 18.6% | 27.9% |
| Balance sheet ($M) | ||||||
| Total assets | 44,815 | 41,290 | 61,681 | 65,304 | 61,784 | 69,185 |
| Total equity | -10,631 | -8,208 | -6,311 | -9,446 | -9,870 | -8,028 |
| Interest-bearing debtSum of short- and long-term borrowings, notes/bonds payable | 28,168 | 24,783 | 34,875 | 41,243 | 42,166 | 45,134 |
| Equity ratio | -28.0% | -24.5% | -14.5% | -17.2% | -19.0% | -14.4% |
| Cash flow ($M) | ||||||
| Operating CF | 9,812 | 11,967 | 10,803 | 9,204 | 12,217 | 12,233 |
| Investing CF | -1,154 | -2,358 | -15,679 | -3,598 | -1,092 | -3,967 |
| Financing CF | -8,496 | -11,977 | 3,806 | -5,582 | -9,481 | -8,132 |
| Free cash flowcalccash flow from operations − capital expenditures | 9,210 | 11,219 | 9,726 | 7,883 | 10,773 | 10,664 |
| Cash and equivalents | 7,280 | 4,496 | 3,207 | 3,060 | 4,216 | 4,872 |
| Per share & other | ||||||
| EPS ($) | 5.16 | 5.83 | 5.81 | 5.02 | 4.52 | 7.26 |
| BVPS ($) | -8.07 | -6.52 | -5.78 | -7.23 | -7.56 | -6.42 |
| Dividend per share ($) | 4.74 | 4.90 | 5.04 | 5.14 | 5.30 | 5.64 |
| Payout ratiocalcdividend per share ÷ diluted EPS × 100 | 91.9% | 84.0% | 86.7% | 102.4% | 117.3% | 77.7% |
| P/E (x) | 16.0 | 16.3 | 17.4 | 18.7 | 26.6 | 22.1 |
| EV/EBITDA (x)calc(market cap + interest-bearing debt − cash and equivalents) ÷ (operating income + depreciation & amortization) | 11.8 | 12.0 | 14.2 | 14.2 | 14.8 | 17.2 |
Figures without a "calc" tag are as reported in the Form 10-K (the consolidated financial statements and, for older years, earlier 10-Ks), pulled automatically from SEC EDGAR. Where a later filing restated a prior period, the restated figure is used.
Last 8 quarters
Three-month figures from 10-Q filings. Change is versus the same quarter a year earlier. Newest quarter on top.
| Quarter ended | Revenue | Operating income | Net income | Diluted EPS |
|---|---|---|---|---|
| 2026-09-30 | $11.44B+5.5% | $4.87B+14.1% | $3.31B-4.7% | $2.12 |
| 2026-06-30 | $11.19B+10.4% | $4.53B+22.0% | $2.82B-7.3% | $1.80 |
| 2026-03-31 | $10.15B+9.1% | $3.89B+9.8% | $2.44B-9.4% | $1.56 |
| 2025-12-31 † | $10.36B+6.8% | $3.37B+3.5% | $2.14B | — |
| 2025-09-30 | $10.85B | $4.26B | $3.48B | $2.23 |
| 2025-06-30 | $10.14B | $3.71B | $3.04B | $1.95 |
| 2025-03-31 | $9.3B | $3.54B | $2.69B | $1.72 |
| 2024-12-31 † | $9.71B | $3.26B | −$579M | — |
† Fourth quarter = the 10-K’s annual figure minus the first three quarters; quarterly EPS isn’t derived this way because share counts change during the year.
14
Is ROIC above WACC?From SEC data
ROIC (the return on money invested in the business) above WACC (the cost of raising that money) means the company is creating value. WACC is an estimate, so its assumptions can be adjusted below.
ROIC (FY2025)
33.5%
formulaoperating income × (1 − tax rate) ÷ invested capital × 100 *invested capital = interest-bearing debt + total equity (average of beginning/ending)
e.g.$14,892M × (1 − 22%) ÷ $34,701M × 100 = 33.5%
termsOperating income · Effective tax rate · Invested capital · Interest-bearing debt · Total equity
WACC (this site’s estimate)
5.96%
formulacost of equity × equity weight + cost of debt × (1 − tax rate) × debt weight
e.g.Equity weight: $249.69B ÷ ($249.69B + $45.13B) = 84.7%
e.g.Debt weight: $45.13B ÷ ($249.69B + $45.13B) = 15.3%
e.g.WACC: 6.5% × 84.7% + 3.5% × (1 − 22%) × 15.3% = 5.96%
termsCost of equity · Equity weight (E/(D+E)) · Cost of debt · (1 − tax rate) · Debt weight (D/(D+E)) · Market capitalization
How firm is this? With the equity risk premium ±1 point and beta ±0.2, WACC runs 5.0%–7.3% and ROIC − WACC runs +26.2 to +28.5 points. The sign holds across this range. This describes the latest year and does not predict future value creation.
WACC 5.96% is this site’s estimate under the assumptions below (not a figure the company has published)
- Risk-free rate
- 4.95% (10-year Treasury, 2026-11-03)
- β
- 0.29 (price-derived adjusted beta, but correlation with the market is low (R² 0.00), so reliability is limited)
- Equity risk premium
- 5.5%
- Cost of equity
- 6.54%
- Cost of debt
- 3.52%
- Tax rate
- 22% (effective rate, FY2023–FY2025)
- Capital structure (equity : debt)
- 85% : 15%
ROIC over time, vs. WACC
Unit: % — bars = each period's ROIC, horizontal line = latest WACC. Bars above the line are green, below are red
- ROIC (above WACC)
- ROIC (below WACC)
- WACC 5.96%
formulaoperating income × (1 − tax rate) ÷ invested capital × 100 *invested capital = interest-bearing debt + total equity (average of beginning/ending)
termsOperating income · Effective tax rate · Invested capital · Interest-bearing debt · Total equity
formulacost of equity × equity weight + cost of debt × (1 − tax rate) × debt weight
termsCost of equity · Equity weight (E/(D+E)) · Cost of debt · (1 − tax rate) · Debt weight (D/(D+E)) · Market capitalization
Try different WACC assumptions
β and the equity risk premium are estimates with a real range of plausible values — move the sliders to check whether ROIC > WACC still holds. The risk-free rate starts at the 10-year Treasury yield on 2026-11-03 (U.S. Treasury).
Initial β: 0.29 (price-derived adjusted beta. Raw β -0.06, R² 0.00, 130 weeks)
formula0.67 × β + 0.33 (β = the slope of weekly stock returns regressed on weekly market returns)
e.g.0.67 × -0.063 + 0.33 = 0.288
termsβ (beta)
Period 2024-05-10–2026-11-04, using S&P 500 ETF (SPY) as the market proxy. Source: Yahoo Finance price history.
formularisk-free rate + β × equity risk premium
e.g.5.0% + 0.29 × 5.5% = 6.5%
termsCAPM · Risk-free rate · β (beta) · Equity risk premium (market risk premium)
formulafiscal year-end closing price × shares outstanding (= market cap)
formulainterest expense ÷ interest-bearing debt × 100 (clamped to 0–10%; falls back to the risk-free rate if there’s no debt)
15
What the price implies (DCF)From SEC data
A company's value can be written as its free cash flow divided by (cost of capital − perpetual growth). Working that backwards from the market's valuation shows how much growth the share price assumed — compared here with the company's actual past growth.
Growth the price implies (price on 2026-11-04)
3.1%
Perpetual FCF growth: g = r − FCF ÷ EV = 6.0% − 2.9%
Past FCF growth (FY2020–FY2025)
+3.0%
Compound annual rate, 5 years
Past revenue growth (FY2020–FY2025)
+7.2%
Compound annual rate, 5 years
Inputs (FY2025): free cash flow $10.66B (operating CF − capex); enterprise value $366.19B = market cap $325.93B (latest close, 2026-11-04) + debt $45.13B − cash and short-term investments $4.87B; r = WACC of 6.0% using this page’s default assumptions (β 0.29, risk-free 5.0%, market premium 5.5%).
Three WACC scenarios
The same calculation under cautious, base and optimistic cost-of-capital assumptions (risk-free rate fixed at the 10-year Treasury yield). Pick one to load it into the sliders below.
Try your own assumptions
V = FCF ÷ (r − g). It starts at the implied growth rate, where the theoretical value equals today’s enterprise value.
Theoretical enterprise value
$367.72B
FCF $10.66B ÷ (6.0% − 3.1%)
Theoretical ÷ actual enterprise value
1.00x
Above 1x: these assumptions value the business above the market did
How sensitive the answer is
Theoretical ÷ actual enterprise value for each combination of r and g.
| g \ r | 4.0% | 5.0% | 6.0% | 7.0% | 8.0% |
|---|---|---|---|---|---|
| 0% | 0.73x | 0.58x | 0.49x | 0.42x | 0.36x |
| 2% | 1.46x | 0.97x | 0.73x | 0.58x | 0.49x |
| 4% | — | 2.91x | 1.46x | 0.97x | 0.73x |
| 6% | — | — | — | 2.91x | 1.46x |
| 8% | — | — | — | — | — |
A simplified model for seeing what the market price assumes, not a forecast or a target price. It treats free cash flow as growing at one constant rate forever; the result swings widely with small changes in r and g, and is undefined when g reaches r. Free cash flow here is operating cash flow minus capex, which is after interest — a full DCF of enterprise value would use cash flow before interest. Market cap uses the latest close (2026-11-04) × shares at fiscal year-end; free cash flow and WACC inputs are from the latest fiscal year.
16
Earnings qualityFrom SEC dataShow
The same reported profit can mean different things depending on whether it's backed by cash, driven by the core business, or the result of a one-off item. Four checks below.
- ✓
Operating CF ÷ net income: averages 1.29x
Profit is backed by cash coming in.
- ✓
Accrual ratio (latest): -1.4%
A small share of profit rests on accounting estimates.
- ✓
Core-earnings share (operating income ÷ pretax income): 107%
Most profit comes from core operations.
- ✓
Days sales outstanding: 37 → 38 days
No major slowdown in collecting on sales.
Operating CF vs. net income
Unit: $M — operating CF above net income means profit is backed by cash
- Operating CF
- Net income
formulacash flow from operations ÷ net income attributable to the company
termsCash flow from operations (operating CF) · Net income (attributable to the company)
formula(net income − operating CF) ÷ average total assets × 100
termsNet income (attributable to the company) · Cash flow from operations (operating CF) · Total assets
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-06
Profit bridge (FY2025)
Unit: $M — what moved profit from operating income to net income
- Profit (each stage)
- Pushed profit up
- Pushed profit down
formulaoperating income ÷ income before income taxes × 100
termsOperating income · Income before income taxes (pretax income)
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-06
Receivables & inventory days
Unit: days — days grow when receivables or inventory build up faster than sales
- Days sales outstanding
- Days inventory outstanding
formulaaverage receivables (opening + closing ÷ 2) ÷ revenue × 365
formulaaverage inventory (opening + closing ÷ 2) ÷ cost of revenue × 365
termsInventory · Cost of revenue (COGS)
Worked examples (latest period)
formulacash flow from operations ÷ net income attributable to the company
e.g.$12,233M ÷ $11,348M = 1.08x
termsCash flow from operations (operating CF) · Net income (attributable to the company)
formulaoperating income ÷ income before income taxes × 100
e.g.$14,892M ÷ $13,880M × 100 = 107%
termsOperating income · Income before income taxes (pretax income)
formulaaverage receivables (opening + closing ÷ 2) ÷ revenue × 365
e.g.($3,789M + $4,572M) ÷ 2 ÷ $40,648M × 365 = 38 days
formulaaverage inventory (opening + closing ÷ 2) ÷ cost of revenue × 365
e.g.($9,453M + $11,478M) ÷ 2 ÷ $13,366M × 365 = 286 days
termsInventory · Cost of revenue (COGS)
17
Who holds the sharesFrom SEC dataShow
How much of the stock large institutional investors report owning on SEC Form 13F, how much the directors and executive officers hold (and how much of the vote they control), and roughly how much is left for individual investors. Shown next to beta so the holder mix can be read alongside how much the stock swings.
Institutions, insiders and everyone else, 13F holdings as of 2026-06-30
“Everyone else” is what remains after shares reported on Form 13F and shares held by directors and executive officers: mostly individual investors, plus non-insider families or foundations and smaller or foreign institutions. The figures have different dates and 13F reports count some shares twice — read it as an approximate split.
- Held by 13F filers
- 84.0%
- Directors & officers (shares)
- <1%
- Everyone else (est.)
- 16.0%
- Directors & officers (voting power)
- <1%
- Institutional-ownership rank
- 272 of 416
- Beta (adjusted)
- 0.29
individuals and other non-13F holders
no separate voting figure; shown as shares
1 = most institutional; 65% of covered companies have more
above 1 = swings more than the market
- 1,309.2M shares reported by 2,922 13F filers ÷ 1,558.6M shares outstanding on 2026-07-17. Option positions are excluded.
- Directors and executive officers as a group, from the proxy statement’s beneficial-ownership table (percentage computed from the group’s share count ÷ shares outstanding); includes shares they can acquire within 60 days.
- A large “everyone else” share can still reflect a family, trust or foundation stake held outside the board; check the proxy statement’s 5% holders.
Sources: SEC Form 13F data set (holdings as of 2026-06-30) · Form DEF 14A filed None (beneficial ownership table) · Form 10-Q cover page (shares outstanding as of 2026-07-17)
18
Strengths & weaknessesSite analysis
Strengths
1. Smoke-free growth
Smoke-free net revenues rose from $12.8B (2023) to $16.9B (2025), now 41% of the total.
Evidence: Form 10-K (FY2025)
2. Market leadership
29.2% share of the international cigarette and HTU market (excluding China and the U.S.).
Evidence: Form 10-K (FY2025)
3. Cash generation
Operating cash flow of $12.2B in 2025 funded $8.6B of dividends.
Evidence: SEC EDGAR XBRL; Form 10-K (FY2025)
Weaknesses
1. Heavy debt, negative equity
Long-term debt was $45.1B and stockholders' equity negative at end-2025.
Evidence: SEC EDGAR XBRL
2. Customer concentration
One customer in EA, AU & PMI GTR (10%) and one in Europe (12%) each accounted for a material share of 2025 net revenues.
Evidence: Form 10-K (FY2025)
3. Declining cigarettes
Cigarette market share fell to 23.4% in 2025 from 23.8% in 2023.
Evidence: Form 10-K (FY2025)
19
What draws investors to itSite analysis
Why the stock can look attractive to investors — each point paired with what has to hold for it to stay true, and the opposing view. This is this site's analysis, not a recommendation to buy or sell.
P/E (FY2025)
22.1x
Price at fiscal year-end ÷ diluted EPS
Dividend yield (FY2025)
3.52%
Dividends per share ÷ fiscal year-end price
Payout ratio (FY2025)
78%
Dividends per share ÷ diluted EPS
FCF yield (FY2025)
4.3%
(Operating CF − capex) ÷ market cap
1. Dividend payer in transition
Large, rising dividends funded by cigarette cash flows while smoke-free grows.
- What has to hold
- Smoke-free growth offsets cigarette decline.
- The other side
- High leverage and regulatory risk.
Evidence: Form 10-K (FY2025)
2. ZYN and IQOS
Two leading smoke-free brands.
- What has to hold
- Adult smokers keep switching.
- The other side
- Regulation and competition in pouches and heated tobacco.
Evidence: Form 10-K (FY2025)
Book value per share is negative because stockholders' equity is negative.
20
ResilienceSite analysisShow
How well the company could absorb a bad year: its financial buffer, how its revenue and profit held up in the worst year on record, and what the 10-K says about the business's exposure to shocks. Figures and filing statements only — no overall rating.
1. Financial buffer (FY2025)
Cash & short-term investments ÷ debt due within a year
1.3x
$4.87B vs. $3.7B
Interest coverage (operating income ÷ interest expense)
9.4x
$14.89B vs. $1.59B
Free cash flow ÷ dividends paid
1.2x
$10.66B vs. $8.62B (FCF = operating CF − capex)
2. Worst year in the record, and the recovery
| Figure | Worst year-over-year change | Back to the prior level? |
|---|---|---|
| Revenue | No decline in the record | — |
| Operating income | -5.6% in FY2023 ($12.25B → $11.56B) | Yes, by FY2024 |
Covers only the 6 fiscal years on record (FY2020–FY2025), which may not include a full recession — the worst year here isn’t necessarily how the company would fare in a severe downturn.
3. Business resilience (from the 10-K)
Profitable every year
Net earnings of $7.1B–$11.3B a year in 2020–2025.
Source: SEC EDGAR XBRL
21
Legal & regulatory mattersSite analysisShow
Lawsuits, government investigations, enforcement actions and settlements the company discloses — where each stands, what is at stake, and what comes next. From the 10-K's Legal Proceedings and contingencies note, the latest 10-Q, and 8-Ks.
PMI faces smoking-and-health and nicotine-pouch litigation, including U.S. putative class actions over ZYN, and a patent dispute in Japan over TEREA. Its deconsolidated Canadian affiliate RBH is in CCAA proceedings under a proposed CAD 32.5 billion global settlement with two other tobacco companies.
3 open matters (1 flagged as major)
Canadian tobacco claims (RBH CCAA plan)
PendingLawsuitMajorRothmans, Benson & Hedges (RBH) and Canadian claimants
A proposed CCAA plan would have RBH, Imperial Tobacco Canada and JTI Macdonald pay a global settlement of CAD 32.5 billion (about $23.7 billion); RBH objected to the allocation in January 2025. PMI accounts for RBH as an equity security until the settlement is paid.
- Amounts
- CAD 32.5 billion aggregate for three companies; allocation unresolved
ZYN nicotine pouch class actions
PendingClass actionConsumers v. PMI and Swedish Match North America
Putative class actions in U.S. federal courts, starting with Kelly v. Philip Morris International (S.D. Fla., March 2024), allege addiction to nicotine from ZYN pouches and seek damages and other relief.
Source: Form 10-Q (quarter ended 2026-09-30) — Note on Contingencies
TEREA patent dispute in Japan
PendingPatent / IPFTKK v. Philip Morris Japan / Sojitz
FTKK alleges TEREA infringes its patent and sought to stop imports through Tokyo Customs; several rulings are under appeal and FTKK filed a new application in December 2025.
Source: Form 10-Q (quarter ended 2026-09-30) — Note on Contingencies
Company statement: Other proceedings are described as ordinary-course and not expected to be material.
Based on Form 10-Q (quarter ended 2026-09-30) — Note on Contingencies, reviewed 2026-11-01. Routine ordinary-course claims are not listed. “Major” is this site’s judgment of which matters could materially affect results.
22
Risks (including geopolitical)Site analysis
Starting from the 10-K's Risk Factors section, organized by category — geopolitical, currency, raw materials, regulatory, disaster, and more — with impact and likelihood assessed by this site.
Risk map
Vertical = impact on results, horizontal = likelihood. Upper right = most severe. Numbers match the list below (placement is this site’s own assessment).
Likelihood →
"Company disclosure" vs. "this site’s assessment"
The description and mitigation for each risk are this site’s summary of the 10-K’s "Risk Factors" section. Impact and likelihood are this site’s own assessment, not the company’s — where the company discloses its own likelihood assessment, that is noted in the summary.
Impact is judged from how large the affected business is relative to total revenue/profit, and from the risk’s track record of moving results in the past. Likelihood is judged from the filing’s wording and the current business environment (already occurring, or recurring). See the rating criteria.
- 1Law & regulation
Tobacco regulation and taxes
- Company disclosure (summarized from the 10-K)
- Excise taxes, product rules and marketing restrictions can cut demand and margins.
- Company’s stated mitigation
- Not stated in the filings.
- This site’s assessment
- Impact High / Likelihood High
- 2Law & regulation
Litigation
- Company disclosure (summarized from the 10-K)
- Smoking-and-health, ZYN and patent cases (e.g. Japan TEREA patent dispute) could be costly.
- Company’s stated mitigation
- Not stated in the filings.
- This site’s assessment
- Impact Med / Likelihood Med
- 3FX & interest rates
Currency
- Company disclosure (summarized from the 10-K)
- Most revenue is outside the U.S., so a stronger dollar reduces reported results.
- Company’s stated mitigation
- Hedging - As discussed below in “Market Risk,” we use derivative financial instruments principally to reduce exposures to market risks resulting from fluctuations in foreign currency exchange and interest rates by creating offsetting exposures.
- This site’s assessment
- Impact Med / Likelihood High
- 4Competition & technology shift
Competition and illicit products
- Company disclosure (summarized from the 10-K)
- Competitors and illicit trade, including products that circumvent regulations, pressure share.
- Company’s stated mitigation
- Not stated in the filings.
- This site’s assessment
- Impact Med / Likelihood High
- 5Geopolitics & supply chain
International operations
- Company disclosure (summarized from the 10-K)
- Operations in many countries expose PMI to political and economic instability.
- Company’s stated mitigation
- Not stated in the filings.
- This site’s assessment
- Impact Med / Likelihood Med
23
What changed in the risk factorsFrom SEC data
Paragraphs in the latest 10-K's Risk Factors that have little overlap with the year before, and paragraphs that were dropped.
New or substantially reworded (8)
Classification of the product as food such that any nicotine amounts beyond de minimis content de facto bans the nicotine product from the market
The success of our business in the United States is dependent on an evolving legal and regulatory framework.
Our business is subject to changes in adult consumer preferences and if we do not accurately assess market trends, are unable to adapt our product offerings to evolving consumer demands, or face challenges in product development, we could experience missed opportunities, supply chain challenges, reduced competitiveness, inefficient expenditures, and potential impacts on our customer base and brand reputation. Furthermore, restrictions pertaining to packaging, labeling, or promotional and advertising activities may limit our ability to effectively communicate product innovations intended to address changing adult consumer preferences. Any of these factors could have a material adverse effect on our results of operations, revenues, cash flows, profitability, and prospects for growth.
Risks Related to Sourcing, Distribution and Quality of Products, Services and Materials
Additionally, we expect that these third parties adhere to our applicable standards and to applicable laws related to product quality, responsible marketing, data protection, labor practices, and other areas. Read more
Our ability to monitor and enforce compliance is inherently limited and these parties may fail to comply with our standards or to operate in accordance with our expectations or legal requirements, which could expose us to operational disruptions, legal or regulatory liabilities, reputational damage, or financial losses.
While we seek to mitigate the physical risks to our business associated with the natural environment through a comprehensive strategy that includes the development and implementation of robust mitigation and adaptation measures, we recognize that there are residual risks that lie beyond our operational control. For example, increased frequency and intensity of extreme droughts, floods, and/or heatwaves could negatively affect our manufacturing operations, tobacco-growing areas, third-party operators and third-party manufacturers sites, and supply regions for products and raw materials, all of which may lead to disruption of our supply chain and of operations at factories, warehouses and other premises.
Additionally, we source the vast majority of our tobacco from a global network of farmers across multiple countries, rather than through commodity markets, which helps ensure the consistency, quality, and traceability of our tobacco supply. Read more
However, this model also means that disruptions to farmer livelihoods, if not actively mitigated, could lead to supply chain disruption through farmer exit, reduced crop quality, unsustainable farming practices, increased regulatory scrutiny, and reputational risks.
We increasingly use artificial intelligence-based solutions in our business, which could result in reputational harm, legal liability, and adversely affect our operating results.
No longer in the text (4)
Our key strategic priorities are to: (i) continue developing and commercializing products that present less risk of harm to adult smokers who switch to smoke-free products versus continued cigarette smoking; Read more
and (ii) encourage and educate current adult smokers who would otherwise continue to smoke cigarettes to switch to those products. For our efforts to be successful, we must:
• for those adult smokers, our goal is to develop and offer SFPs with a scientifically substantiated risk-reduction profile that approaches as closely as possible the risk-reduction profile associated with smoking cessation;
• substantiate the reduction of risk for the individual adult smoker and the reduction of harm to the population as a whole, based on scientific evidence of the highest standard that is made available for scrutiny and review by external independent scientists and relevant regulatory bodies; and
The World Health Organization (the "WHO") study group on tobacco product regulation published their ninth report on the scientific basis of tobacco product regulation in August 2023. Read more
The report is based on a review of scientific evidence related to novel and emerging nicotine and tobacco products, such as electronic nicotine delivery systems ("ENDS"), electronic non-nicotine delivery systems and HTPs. The report concludes by making a number of policy recommendations on HTPs and ENDS that, if implemented, could restrict both the availability of these products and the access to accurate information about them. In August 2021, the Framework Convention on Tobacco Control (the "FCTC") Secretariat published two reports on novel and emerging tobacco products to the Ninth Session of the CoP of the FCTC, which are not materially different from the WHO study group report. Substantive decisions…
12 more paragraphs differ; the filings below have the full text.
Matched automatically, quoted as filed, and may include rewording of an existing risk. Compares Item 1A of the 10-K filed Feb 6, 2026 ↗ with the 10-K filed Feb 6, 2025 ↗.
24
What to watch going forwardSite analysis
- Smoke-free growth (IQOS, ZYN) and margins.
- U.S. ZYN supply and regulation.
- Resolution of the Canadian CCAA settlement (RBH).
- Debt reduction and dividend coverage.
25
Source documentsShow
This page's financial figures come from the Form 10-Ks listed below. Check the original filings for full detail.
Other sources referenced in the analysis
Last updated
Analysis last edited: November 1, 2026 · Financial data fetched: November 1, 2026 09:31 (SEC EDGAR) · Source 10-K filed: February 6, 2026
Built on10-K FY2025 · filed 2026-02-06Proxy statement (2026)
Next update expectedAfter FY2026’s 10-K is filed (roughly 60–90 days after fiscal year end (sooner for larger filers)), financials and analysis will be refreshed.
This page is this site’s own analysis based on public information, and does not represent Philip Morris International’s views. It is not a recommendation to buy or sell any security, and this site does not guarantee the accuracy of any figure or statement here. Always verify against the original source documents before making an investment decision.