Philip Morris International (PM) is an international tobacco maker with products sold in over 160 countries. It owns 7 of the top 15 brands in the world and has 75,000 employees. It was spun off of Altria Group on March 28, 2008.

When one thinks of “vice stocks” this is the first stock that pops into many people’s minds. In this economy, that is surely a good thing. Tobacco stocks are some of the most recession proof equities out there, and Philip Morris International is one of the best-run companies as well. With the market tanking, many people are trying to puff away their problems.

PM is a popular pick these days due to a robust international environment and no American exposure. The lack of American exposure is attractive because of the lessened litigation risk. The company generates strong and consistent cash flows, which allow it to buyback lots of stock. Its current buyback program is over $13 billion over the next few years. This is certainly comforting to jittery investors.

Its earnings estimates have been trending up nicely over the past three months. During that time frame, this year’s estimates have gradually increased six cents to $3.25 per share. Next year’s numbers have risen nine cents. The stock is currently selling for 14.8x next year’s estimates, which isn’t unreasonable, especially in this environment. Its solid dividend of 3.4% will suit income investors as well. We also love the company’s huge ROE of 44.4%, indicating that management is being very efficient. We see this stock hitting $60 over the next 6-12 months.

Suggested Stop: $51.14