Philip Morris International Inc. (PM) is a global tobacco and nicotine company located in Stamford, Connecticut. It sells popular cigarette brands like Marlboro and is shifting towards smoke-free products with its “Beyond Nicotine” strategy. Its leading smoke-free product, IQOS, uses heat-not-burn technology and has gained popularity worldwide. PM operates in over 180 markets, aiming to lessen the health risks of smoking by investing in alternatives and advanced nicotine delivery systems. Since hitting an all-time low of $32 in March 2009, PM’s stock price has risen dramatically by over 475%, reaching a peak of $186 in June. The stock has shown a clear 3-swing pattern and is set to develop into at least a 5-swing chart, with wave (III) possibly targeting $204 or more. Waves I and II of (III) ended at the high in February 2022 and the low in September 2022. Wave III of (III), starting in September 2022, peaked in June 2025, followed by a pullback. On October 29, 2025, the price hit the blue box zone and bounced back, signaling the beginning of wave V. The target for wave V is between $197 and $215. On December 29, 2025, the price retested the blue box, surged, and hit the first target at $163.5, with potential to reach $180-$200. This cycle from the low in October is expected to reach $215. With Philip Morris’ price firmly bouncing from the low in October 2025, our initial target has been achieved, creating a risk-free position for early investors. The recent retest of the buy zone followed by a strong upward move indicates the next phase of the rally is starting. We view this as a chance to add to bullish positions, as the likely trend is upward. This positive trend is backed by strong fundamentals, as shown in the company’s quarterly report from October 2025. In that report, the user base for IQOS grew to over 33 million, making smoke-free products nearly 40% of total revenues. This ongoing success in its strategic shift supports our bullish outlook. In the coming weeks, we should consider longer-term call options to take advantage of the anticipated rise to the $180-$200 range. Options expiring in March or April 2026 would provide ample time for the trade to evolve while minimizing time decay. Strike prices around $170 or $175 could offer a favorable balance of risk and reward as this upward wave gains momentum. Any short-term pullbacks should be seen as buying opportunities, not weaknesses. Historical examples, like the strong rally that began after the low in March 2020, which saw the stock gain over 50% in a year, show that the current setup from the October 2025 bottom might exhibit similar strength and speed. As the price rises, implied volatility may increase, benefiting long call positions. We will keep a close eye on the price movements as it approaches the previous all-time high set in June 2025. Breaking through this level would signal a major breakout, making way for our ultimate target. The cycle that began in October is projected to reach $215, which will be our final profit-taking zone for this long-term trade. Until then, we will manage the position, taking partial profits at key resistance levels while allowing the core trade to continue.

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