Looking for Reliability? This 7.3%-Yielding Dividend Stock Has Been a Model for Dependability Over the Decades.

Altria Group (NYSE: MO) is a major consumer goods company that focuses on tobacco products. Its portfolio includes the popular Marlboro brand, one of the world's best-selling cigarette brands, and other products such as smokeless tobacco, wines, and alternative nicotine ventures.

The stock's been down recently due to a disappointing third quarter. However, to decide whether or not Altria stock is a buy, we need to consider the company's history, particularly its commitment to providing shareholder value.

Spoiler alert: I think it is.

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What's happening with Altria's stock price

As of Nov. 17, 2025, MO stock was trading around $58, down from around $67 in early October. Most analysts attribute the stock's decline to its 1.7% drop in revenue for the third quarter and lower shipments of its star brand, Marlboro.

A sharp drop like that is concerning, though you have to ask yourself: Is it the end of the sell-off, or the lead-up to a steeper decline?

In Altria's case, it seems to be the former. The stock has rebounded somewhat from its recent low of $56, and prices have consolidated around current levels. Naturally, some income investors are eyeing the stock for a potential entry point. I know I am. Let's talk about why.

Altria: The undisputed leader of the Dividend Kings list

Altria has increased its dividend for the last 56 consecutive years and is part of the elite Dividend Kings list, a select group of companies that have increased their dividend payouts for 50 consecutive years or more. Today, there are fewer than 60 Dividend Kings, including the unofficial ones.

To put that into perspective, Altria has boosted payouts for longer than many investors have been alive. That's not an easy feat.

Second, the company often holds the title of the highest-yielding Dividend King, and that's true this week. At this writing, the company pays a 7.3% forward yield based on the stock's latest trading price.

For younger income investors with longer time horizons, the increasing income alone is a juicy proposition.

Is Altria stock fairly valued?

Today, Altria trades at a price-to-earnings ratio of 12.6. That means investors are paying nearly 13 times what the company is earning to buy one share of the stock. It's actually pretty cheap, all things considered.

So, why all the doom and gloom about Altria? Well, there are a couple of things investors need to be aware of.

The bear case for Altria stock

First, the company's top line has been either flat or declined by a few percentage points over the last four years. For example, annual revenue decreased from $26 billion to $24 billion between 2020 and 2024.

Here's the problem: Top-line weakness suggests weakening demand, which will be reflected in the bottom line eventually. That said, despite its declining sales, Altria's bottom line has actually increased 144%, from $4.5 billion in 2020 to $11 billion in 2024.

Meanwhile, the company has a dividend payout ratio of around 76%. That means it uses more than three-quarters of its earnings to pay out dividends. For reference, a healthier payout ratio between 25% and 60% can allow the company ample headroom for reinvesting in its business while maintaining, and possibly even increasing, its dividend. That 76% is a bit on the high side, though.

Is Altria stock a buy today?

A consensus among 15 analysts rates MO stock a "hold" with a high target price of $72. This suggests as much as 24% upside over the next 12 months.

Overall, Altria offers a high yield, a low valuation, and a proven track record of delivering shareholder value. Based on that, I think that at today's prices, MO stock could be a good entry point for long-term dividend growth investors.

Rick Orford has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.