                               PHILIP MORRIS

                                 3/29/94

                      Stock    Latest      52 week     YTD Pr    Div  Gross
                      Rating    Price   --- Range ---    Chg     Rate Yield
Philip Morris Companie  RL      51.25       65-45        -8      2.76  5.4

                                 Est.        - Interim EPS -    -EBITDA 94-
          FY/IP       EPS93     EPS94 PE94   --Next- -YrAgo-    per/sh  p/e
MO        12/01Q      4.58R      5.30  9.7       n/a     n/a      n/a   n/a

PHILIP MORRIS (MO) $51 1/4 1994 $5.30 1995 $5.95. U.S. REC. LIST

HIGHLIGHTS:

1.           February supermarket data continued to show very strong
  market share gains for Marlboro and Philip Morris overall.
2.           Analysts' confidence in their  estimates of $5.30 for 1994
  and $5.95 for 1995 remains strong despite the recent rise in concern
  about regulation.
3.           Stock is priced at only 9.7X the 1994 earnings estimate
  with a 5.4% yield and is discounting an extremely poor U.S. cigarette
  outlook.

ADDITIONAL DETAILS:

1.           CONSUMPTION TRENDS - February data continued to show a
  strong market share gain by Marlboro and Philip Morris as a whole.
  Table 1 below shows that during the latest 12-week period ending
  February 27, 1994, Marlboro gained 3.5 share points versus a year ago
  to reach 22.7% of industry supermarket sales.  Share of Philip Morris
  brands overall increased 4.4 percentage points to 41.9% (this excludes
  company produced private labels.)  The Marlboro and total company
  share gains were even stronger during the latest 4 week period.
  Marlboro's market share has increased to more than 23% from a low of
  19% a year ago.

Table 1

Market Share Trends In Large Supermarkets

                         Philip Morris    Chg.         Marlboro    Chg.

Full Year 1993              39.9%       +2.3 pts         21.6%   +1.7 pts.
Latest Six Months           41.3%       +3.6 pts         22.7%   +2.7 pts.
Latest Three Months         41.9%       +4.4 pts         23.1%   +3.5 pts.

Source:  Information Resources, Inc. InfoScan Review

2.           IMPROVED FUNDAMENTALS - Analysts increased their earnings
  estimates last month on indications that fundamentals have
  strengthened in Philip Morris' U.S. cigarette operations.  Both the
  January and February consumption data are consistent with this view.
  Specifically, analysts continue to believe that PM USA unit volume
  will increase 3-4% in 1994 and that product mix will improve as
  smokers continue their return to premium brand already evidenced.  Net
  pricing should be only moderately lower, down 5-6% compared with
  previous expectation of a double-digit decline, because of reduced
  price discounting.

3.           TOBACCO CONTROVERSY - Recent developments have not been
  kind to the tobacco industry.  Even so, analysts still believe that
  excise taxes will emerge from Congress lower than as proposed by
  President Clinton and that it is improbable that the FDA will be given
  authority to regulate and ban cigarettes.  The proposed OSHA
  regulations that could ban smoking in bars and restaurants is a
  difficult battle for the industry that is hard to evaluate.  Still,
  investors appear to be overreacting.  It is worth noting that Philip
  Morris would earn $3.30 in 1994 and be capable of 13% growth after
  1994 even if U.S. cigarette operations fell to a break-even level.
  This means that the whole company is selling for 15.5x the 1994
  earnings of the non-U.S. cigarette operations.  The U.S. cigarette
  business earned $2.8 billion before taxes last year.

4.           INVESTMENT RATING - Philip Morris stock is selling at only
  9.7X 1994 earnings and is at a 35% discount to the S&P 500 with a 5.4%
  yield.  Analysts believe that management is very dissatisfied with
  stock price performance and will continue actions to improve
  shareholder value.  The company has become very active buying shares
  since resuming its repurchase program last month.  Analysts believe
  that this program is now more than 20% complete and that, around
  mid-year, management is likely consider another that could amount to
  repurchase of as much as 7-10% of the total stock outstanding over a
  multi-year period.  In addition, management has indicated that
  additional asset sales aimed at improving profitability of the
  company's food and beverage operations are under consideration.  On
  balance, the outlook continues be strong and analysts believe that the
  stock can still appreciate to $70 within 12 months.
