Earnings

The company reported earnings of $148 million, or 28 cents per share, down from $292 million, or 54 cents per share, a year ago. Excluding special items, earnings were 87 cents per share, matching analysts’ estimates.

Revenue
Revenue came in at $2.13 billion, up from $2.04 billion last year. Analysts expected to see $2.14 billion in revenue.

Outlook
For FY2015, RAI expects to see EPS between $3.65 and $3.80. Analysts expect to see EPS of $3.71.

While income-focused investors have flocked to high yield tobacco plays like Reynolds American, there is little revenue growth for many of these companies. Despite the attractive dividend yields, these stocks carry a few risks including litigation risk and rising interest rate risk.

Investors interested in RAI may also consider a mutual fund as an alternative to owning the individual stock. The funds below currently hold the largest stakes in RAI.

The funds listed above allow investors to gain exposure to RAI while remaining diversified. Investors interested in RAI may also be interested in Phillip Morris (PM) and Altria (MO).