Reynolds American Inc. (NYSE:RAI) traded down 2.6% during trading on Wednesday following a dissappointing earnings announcement. The stock traded as low as $43.38 and last traded at $46.05, with a volume of 9,068,921 shares trading hands. The stock had previously closed at $47.27.
The company reported $0.61 EPS for the quarter, missing the consensus estimate of $0.65 by $0.04. The firm had revenue of $3.21 billion for the quarter, compared to analysts’ expectations of $3.31 billion. Reynolds American had a net margin of 42.97% and a return on equity of 15.24%. Reynolds American’s revenue was up 1.4% on a year-over-year basis. During the same period in the prior year, the firm posted $0.55 EPS.
The company also recently disclosed a quarterly dividend, which was paid on Monday, October 3rd. Investors of record on Monday, September 12th were paid a dividend of $0.46 per share. The ex-dividend date of this dividend was Thursday, September 8th. This represents a $1.84 annualized dividend and a yield of 3.89%. This is a boost from Reynolds American’s previous quarterly dividend of $0.42. Reynolds American’s payout ratio is currently 49.73%.
Several equities research analysts have issued reports on RAI shares. Goldman Sachs Group Inc. reiterated a “neutral” rating and set a $53.00 target price on shares of Reynolds American in a research report on Saturday. Jefferies Group lifted their target price on shares of Reynolds American from $61.00 to $62.00 and gave the company a “buy” rating in a research report on Tuesday, October 11th. Citigroup Inc. reiterated a “buy” rating and set a $57.00 target price on shares of Reynolds American in a research report on Monday, September 26th. Vetr upgraded shares of Reynolds American from a “buy” rating to a “strong-buy” rating and set a $56.12 target price for the company in a research report on Thursday, September 8th. Finally, Morgan Stanley reiterated a “hold” rating on shares of Reynolds American in a research report on Thursday, September 1st. Four analysts have rated the stock with a hold rating, eight have assigned a buy rating and two have issued a strong buy rating to the company. The company currently has a consensus rating of “Buy” and an average price target of $55.93.
In related news, major shareholder American Tobacco P.L.C British sold 660,385 shares of Reynolds American stock in a transaction on Wednesday, September 28th. The shares were sold at an average price of $48.03, for a total value of $31,718,291.55. The sale was disclosed in a filing with the SEC, which is available through this hyperlink. 0.11% of the stock is currently owned by corporate insiders.
A number of hedge funds and other institutional investors have recently modified their holdings of the stock. Vanguard Group Inc. increased its position in shares of Reynolds American by 2.2% in the second quarter. Vanguard Group Inc. now owns 62,617,955 shares of the company’s stock worth $3,376,987,000 after buying an additional 1,343,766 shares during the last quarter. Capital World Investors increased its position in shares of Reynolds American by 3.5% in the second quarter. Capital World Investors now owns 43,489,368 shares of the company’s stock worth $2,345,382,000 after buying an additional 1,464,000 shares during the last quarter. FMR LLC increased its position in shares of Reynolds American by 1.0% in the second quarter. FMR LLC now owns 33,494,646 shares of the company’s stock worth $1,806,367,000 after buying an additional 315,803 shares during the last quarter. State Street Corp increased its position in shares of Reynolds American by 3.3% in the first quarter. State Street Corp now owns 31,757,800 shares of the company’s stock worth $1,597,726,000 after buying an additional 1,003,117 shares during the last quarter. Finally, Bank of New York Mellon Corp increased its position in shares of Reynolds American by 0.6% in the second quarter. Bank of New York Mellon Corp now owns 21,533,610 shares of the company’s stock worth $1,161,308,000 after buying an additional 118,437 shares during the last quarter. 46.87% of the stock is currently owned by institutional investors and hedge funds.
The firm has a 50 day moving average price of $47.91 and a 200-day moving average price of $49.92. The firm has a market cap of $65.64 billion, a PE ratio of 12.41 and a beta of 0.40.
Reynolds American Company Profile
Reynolds American Inc (RAI) is a holding company. The Company’s segments are RJR Tobacco, Santa Fe and American Snuff. The RJR Tobacco segment consists principally of the primary operations of R. J. Reynolds Tobacco Company. The Santa Fe segment consists of the domestic operations of Santa Fe Natural Tobacco Company, Inc (SFNTC).
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