Critical Survey: Altria Group (NYSE:MO) versus RLX Technology (NYSE:RLX)

RLX Technology (NYSE:RLX) and Altria Group (NYSE:MO) are both consumer staples companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, profitability, institutional ownership, dividends, valuation and risk.

Dividends

RLX Technology pays an annual dividend of $0.10 per share and has a dividend yield of 6.2%. Altria Group pays an annual dividend of $4.44 per share and has a dividend yield of 5.8%. RLX Technology pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Altria Group pays out 91.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Altria Group has raised its dividend for 56 consecutive years.

Risk & Volatility

RLX Technology has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500. Comparatively, Altria Group has a beta of 0.43, suggesting that its stock price is 57% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for RLX Technology and Altria Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RLX Technology	0	2	0	0	2.00
Altria Group	2	6	5	0	2.23

RLX Technology presently has a consensus price target of $2.50, suggesting a potential upside of 53.85%. Altria Group has a consensus price target of $71.67, suggesting a potential downside of 5.79%. Given RLX Technology’s higher possible upside, research analysts plainly believe RLX Technology is more favorable than Altria Group.

Institutional & Insider Ownership

22.7% of RLX Technology shares are held by institutional investors. Comparatively, 57.4% of Altria Group shares are held by institutional investors. 53.4% of RLX Technology shares are held by insiders. Comparatively, 0.1% of Altria Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares RLX Technology and Altria Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RLX Technology	20.24%	6.20%	5.65%
Altria Group	34.51%	-330.66%	27.43%

Valuation & Earnings

This table compares RLX Technology and Altria Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RLX Technology	$566.11 million	4.45	$131.83 million	$0.10	16.25
Altria Group	$23.28 billion	5.44	$6.95 billion	$4.84	15.72

Altria Group has higher revenue and earnings than RLX Technology. Altria Group is trading at a lower price-to-earnings ratio than RLX Technology, indicating that it is currently the more affordable of the two stocks.

Summary

Altria Group beats RLX Technology on 12 of the 17 factors compared between the two stocks.

About RLX Technology

RLX Technology Inc., together with its subsidiaries, engages in the manufacture and sale of e-vapor products in the People's Republic of China and internationally. It serves partner distributors and retail outlets. The company was founded in 2018 and is headquartered in Beijing, China.

About Altria Group

Altria Group, Inc., through its subsidiaries, manufactures and sells smokeable and oral tobacco products in the United States. The company offers cigarettes primarily under the Marlboro brand; large cigars and pipe tobacco under the Black & Mild brand; moist smokeless tobacco and snus products under the Copenhagen, Skoal, Red Seal, and Husky brands; oral nicotine pouches under the on! brand; and e-vapor products under the NJOY ACE brand. It sells its products to distributors, as well as large retail organizations, such as chain stores. The company was founded in 1822 and is headquartered in Richmond, Virginia.