Can Altria Group Continue to Outperform?

With shares of Altria Group Inc. (NYSE:MO) trading around $33.18, is MO an OUTPERFORM, a WAIT AND SEE, or a STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

E = Equity to Debt Ratio is Far from Zero

Altria’s debt-to-equity ratio of 3.59 looks pretty bad any way you look at it. One of its major competitors, Reynolds American Inc. (NYSE:RAI), clocks in with a debt-to-equity ratio of just 0.67.

We also need to consider total debt and total cash on hand, which for Altria is $13.88 billion in debt, and $2.19 billion in cash. This compares to Reynolds American, which has $3.86 billion in debt and $1.24 billion in cash.

T = Technicals on the Stock Chart are Strong

The stock price was recently 0.39 percent above its 20-day simple moving average, or SMA; 1.31 percent above its 50-day SMA; and 1.97 percent above its 200-day SMA.

Since the beginning of 2012 the stock price has been in a fairly pronounced upward trend, rising 16.27 percent this year-to-date and 20.54 percent year-over-year.

As a benchmark, the S&P 500 has risen 12.30 percent year to date, and 16.54 percent year over year. For comparison, shares of Lorillard, Inc. (NYSE:LO) are up 5.6 percent this year to date, and shares of Reynolds American are up 4.37 percent this year to date.

Not only did Altria’s performance on the stock chart outshine its competition, but its competition didn’t outpace the benchmark.