Altria and Philip Morris International both raised their dividends in 2026, but the two payouts are funded by increasingly different businesses.
Altria's quarterly dividend rose to $1.11 in August, its 61st increase in 57 years. At the prices cited in the source, that produced a forward yield of about 6.2%. Philip Morris lifted its quarterly payment 8.8% to $1.60 in September, for a yield near 3.2%.
The larger Altria yield is not automatically the safer long-term income stream. Its 2026 adjusted earnings guidance of $5.61 to $5.72 implies that the annualized $4.44 dividend consumes about 79% of the low end of guidance. Philip Morris's $6.40 annualized dividend similarly uses a large share of expected earnings, but its profit growth and product mix are stronger.
Philip Morris said smoke-free products generated about 42% of second-quarter revenue. Its international reach and portfolio of heated-tobacco and nicotine products reduce its dependence on one declining cigarette market. Second-quarter net revenue exceeded $11 billion for the first time, and management described organic top-line growth close to 8%.
Altria remains concentrated in the United States, where cigarette volumes continue to shrink. Its second-quarter update narrowed adjusted EPS guidance to growth of 3.5% to 5.5% for 2026. Pricing, buybacks and oral nicotine can support earnings, but the company has less room for volume deterioration when the dividend already absorbs most of expected profit.
That trade-off explains the valuation gap. Altria pays more cash today and may suit an investor who prioritizes current income. Philip Morris offers a lower starting yield but faster dividend growth and a broader smoke-free platform. Neither choice is risk free: regulation can slow new nicotine products, and high payout ratios leave less room for operational mistakes.
For a decade-long holding period, the central question is not which yield is larger today. It is whether earnings can grow faster than the payout. On the evidence available now, Philip Morris has the stronger growth engine, while Altria compensates investors with more immediate income.