Philip Morris International downgraded to Hold as valuation peaks amid growth in smoke-free products.

Philip Morris International has been downgraded to a Hold rating due to its valuation reaching the high end of its historical range. The company's growth is primarily driven by its smoke-free product segment, which now accounts for 42% of net revenue, with strong performance in international markets. Expansion in the U.S., especially with IQOS and ZYN products, remains a key growth driver, though regulatory risks and competition continue to pose challenges. The company has a strong dividend track record with 17 consecutive years of growth, but the current 3.1% yield may be less attractive for income-focused investors.