Something interesting is happening in tobacco stocks right now. Investors are warming up to the sector after spiking Treasury yields put the broader market in the red. Philip Morris International (PM) is right in the middle of that conversation.
The worry is simple. Higher interest rates can pressure dividend stocks because bonds suddenly offer real competition for income seekers. But tobacco stocks have a secret weapon. They generate huge cash flows today, not years from now. They don't need cheap financing to grow, and they have pricing power that helps offset inflation. So, the question is whether PM stock is a victim of rate anxiety or a hiding spot from it. The answer might surprise you.
