ITC judge favors JUUL in patent case against NJOY By Investing.com

RICHMOND, Va. – Altria Group Inc. (NYSE: NYSE:) and its e-vapor subsidiary NJOY are challenging a preliminary ruling by an Administrative Law Judge (ALJ) of the U.S. International Trade Commission (ITC). The judge's preliminary ruling supports JUUL Labs, Inc.'s claims that NJOY infringed its patents and recommends an exclusion order to prevent the importation of NJOY ACE products into the United States.

NJOY disagrees with the judge's initial decision and intends to take its case to the full ITC, with a final decision expected by December 23, 2024. This development follows NJOY's own patent infringement lawsuit against JUUL, filed in August 2023, with an initial decision expected in late September 2024. Even if NJOY prevails in its case, it may not be able to prevent the exclusion order for its ACE product.

In response to the litigation, both parties are in mediation to find a solution. In addition, NJOY has applied to the FDA for exemptions for a modified version of ACE that they believe circumvents the majority of JUUL's patent claims.

Notably, ACE is the first pod-based e-vapor product and the only menthol product of its kind to be approved by the FDA as appropriate for public health use. Excluding it would significantly limit FDA-approved options for adult consumers.

Altria's portfolio includes brands such as Marlboro®, Black & Mild® and Copenhagen®. The company holds a majority interest in Horizon Innovations LLC for the US marketing of heated tobacco products as well as interests in Anheuser-Busch InBev and Chronos Group (NASDAQ:).

The dispute and the ongoing legal proceedings are subject to uncertainties and the outcome is unpredictable. Altria has cautioned that actual results could differ materially due to various risks, including the timing and outcome of litigation and regulatory reviews.

The information in this article is based on a press release.

“In other recent news, Altria Group, Inc. increased its quarterly dividend by 4.1% to $1.02 per share, up from the previous $0.98. This move is part of Altria's ongoing strategy to increase dividends per share by a mid-single-digit percentage annually through 2028, underscoring the company's commitment to increasing shareholder value. In addition, Altria reported stable adjusted diluted earnings per share (EPS) for the second quarter of 2024, despite a slight decline in the first half of the year.

In terms of product development, Altria has expanded its smoke-free portfolio with new products such as on! PLUS and is experiencing growth and market share gains despite challenges from the illegal e-vapor market. The company also revised its full-year 2024 guidance for adjusted diluted earnings per share to a range of $5.07 to $5.15.

Stifel reiterated its buy rating on Altria, citing the company's strong dividend payments, effective free cash flow generation, share repurchase programs and prospects for stable EPS growth as key factors. Altria's continued commitment to a strong balance sheet and investment grade credit rating was also mentioned. These are the latest developments in the Altria Group's business activities.”

InvestingPro Insights

As Altria Group, Inc. (NYSE: MO) navigates its legal challenges with NJOY, investors are closely monitoring the company's financial health and market position. With a stable market capitalization of $89.94 billion and a robust trailing twelve-month gross profit margin of 69.56% (as of Q2 2024), Altria's financial fundamentals remain strong.

InvestingPro's data points to a notable P/E ratio of 9.12, suggesting that the company trades at a low earnings multiple, which could appeal to value investors. In addition, Altria's dividend yield is an attractive 7.74%, complemented by dividend growth of 8.51% over the same period, underscoring the company's commitment to returning value to shareholders. This is also evidenced by InvestingPro's tip that Altria has made dividend payments for 54 consecutive years, making it a potentially reliable income stock.

One of InvestingPro's notable picks is that management has been aggressively buying back shares, which could indicate a strong belief in the company's value and future prospects. For investors seeking detailed analysis and additional insights, InvestingPro offers a comprehensive list of 20 picks, including advanced metrics and expert opinions, available at:

While the legal outcome of the NJOY case remains uncertain, Altria's financial stability and shareholder-friendly behavior may offer investors some reassurance in these turbulent times.

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