NEW YORK (AP) -- Shares of Phillip Morris rose after a Goldman Sachs analyst raised her rating and price target on Friday, saying the cigarette maker's exposure to emerging markets should help drive double-digit earnings per share growth.
THE SPARK: Judy Hong moved the company, which sells Marlboro and other cigarette brands overseas, to "Buy" from "Neutral." The analyst also added Philip Morris to her Conviction List and increased its price target to $103 from $98.
THE ANALYSIS: In a client note, Hong said that emerging markets are important to the business because they comprise 50 percent of Philip Morris' sales. Favorable conditions in markets like Turkey, Russia and Indonesia should help bolster its performance, she explained.
Hong was also unfazed by a tax increase in the Philippines, saying it should have a limited impact on the company's overall profit.
Other positives include a healthy balance sheet and strong free cash flow, Hong added.
SHARE ACTION: Shares of Philip Morris International Inc. rose $1.91, or 2.2 percent, to $89.20 in midday trading. The stock has ranged from $72.85 to $94.13 in the past 52 weeks.