Which Dow component has been the best performer since the Dow peaked back in 2000? (Here's a hint, it's been strong despite tough tobacco laws and rising cigarette taxes) CNBC's Erin Burnett revealed the answer on today's "Street Signs."
Altria Group is the company that's made the best run. The stock has skyrocketed almost 500% in the last 6 years.
Bonnie Herzog, a tobacco and beverage analyst for Citigroup Investment Research said 2007 will be another banner year for Altria (which includes Kraft Foods and PhilipMorris).
She anticipates MO will spin-off the Kraft Foods division as soon as the first quarter. After that, Herzog expects Altria to begin separating its U.S. and international businesses – focusing on growth opportunities overseas.
There is also speculation that Altria might try and break up the expected $15 billion buyout of Europe’s Gallaher Group by Japan Tobacco. Herzog is not sure if it will happen – or what it could mean for investors.
Herzog has a buy on the stock and a price target of $97.
Analyst disclosure: MO, RAI, CG UST are investment banking clients of Citigroup Investment Research. The analyst's firm also has non-investment banking relationship with these securities.