Altria, the owner of food company Kraft and the world's biggest cigarette maker Philip Morris, may split itself up to help limit the effect of legal battles.
Smoking can seriously damage a company's share performance
Law suits against its US tobacco arm have hit Altria's share price and the firm reckons it would do better if the divisions stood separately.
Altria's shares closed at $54.23 on Thursday, but analysts estimate they may be worth up to $80 after a split.
It would operate as Philip Morris US, Philip Morris International and Kraft.
Altria's chairman and chief executive Louis Camilleri said that the firm's shares are undervalued when compared with those of rival tobacco producers.
"Our over-riding objective is to deliver superior returns to our shareholders, and towards that end, we are working to resolve the litigation issues at Philip Morris USA and beginning the necessary preparations for a potential break-up once the litigation environment permits," he told a meeting of investors.
Legal cases are being fought by Philip Morris and other cigarette firms in Florida, Illinois and Washington.
The Department of Justice is alleging that the industry mislead the public over the dangers of smoking and is seeking $280bn (£152bn) in damages.
Analysts expect the legal battle to drag on well into next year.
Kraft Foods, the maker of Oreo biscuits and Ritz crackers, has had its share of problems.
Earnings have been dented by concerns about obesity and as many consumers turn to low-carbohydrate diets.