The tobacco industry includes companies that grow, manufacture and sell tobacco and related products such as cigarettes and e-cigarettes. Sometimes tobacco companies are also referred to as sin stocks. Some investors avoid tobacco companies, including those that focus on socially responsible investing. The largest tobacco companies are Philip Morris International Inc. (PM) and Altria Group Inc. (MO), both of which sell products with dominant brand names.
Tobacco stocks as a group have lagged the broader market. The benchmark MSCI ACWI Tobacco Index delivered a 1-year total return of 25.0%, compared to the Russell 1000’s total return of 37.1% on September 14, 2021.
Here are the top 3 tobacco stocks with the best value, fastest growth and most momentum. All statistics in the tables below are as of September 14, 2001.
These are the tobacco stocks with the lowest price-earnings ratio over 12 months. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows that you are paying less for every dollar of profit generated.
|Best Value Tobacco Stocks|
|Price ($)||Market Capitalization ($B)||12 month ongoing P/E ratio|
|Imperial Brands PLC (IMBBY)||21.42||20.3||5.4|
|VectorGroup Ltd. (VGR)||12.44||1.9||9.8|
|British American Tobacco PLC (BTI)||36.85||84.6||10.0|
- Imperial brands PLC: Imperial Brands is a UK-based consumer goods company that makes and sells cigarettes, cigars, pipes, smokeless tobacco, e-cigarettes and other tobacco products. The company also has a logistics company.
- Vector Group Ltd.: Vector Group is a holding company that, through its subsidiaries, manufactures and markets cigarette products. The company is also active in real estate and has investments in several real estate projects through one of its subsidiaries. On August 23, Vector Group announced a quarterly cash dividend of $0.20 per share, payable to shareholders on September 29, beginning September 15, 2021.
- British American Tobacco PLC: British American Tobacco is a UK-based holding company. Through its subsidiaries, the company makes, markets and sells cigarettes, cigars, roll-your-own tobacco, oral nicotine pouches and related products. BBC Panorama said in a September 2021 report that there was evidence that BAT negotiated bribes for former longtime Zimbabwean leader Robert Mugabe. Other allegations in the report include that the company paid bribes in South Africa and used illegal surveillance. According to BBC Panorama, BAT disputes the veracity of several key aspects of the story. Although BAT declined to answer BBC Panorama’s questions about payments in Zimbabwe, it did not deny paying bribes to Mugabe, who died in 2019. It is against UK law for a UK company to pay bribes anywhere.
These are the best tobacco stocks, ranked by a growth model that rates companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings per share (EPS) growth. Both sales and profits are critical factors for a company’s success. Therefore, ranking companies by only one growth metric makes a ranking susceptible to that quarter’s accounting anomalies (such as changes in tax laws or restructuring costs) that may prevent one figure or the other from being representative of the company in general. Companies with quarterly earnings per share or revenue growth of more than 2500% were excluded as outliers.
|Fastest Growing Tobacco Stocks|
|Price ($)||Market Capitalization ($B)||EPS growth (%)||Revenue growth (%)|
|RLX Technology Inc. (RLX)||5.05||7.9||1.040||291.5|
|VectorGroup Ltd. (VGR)||12.44||1.9||281.2||63.7|
|Turning Point Brands Inc. (TPB)||47.58||0.9||49.0||16.8|
- RLX Technology Inc.: RLX Technology is a China-based e-vapor products company. The company is involved in scientific research, product development, offline distribution and related activities for rechargeable vape products. The company’s net income grew more than 800% YOY for the second quarter of 2021, driven by RLX’s focus on technology investments and brand building.
- Turning Point Brands Inc.: Turning Point Brands is a manufacturer and distributor of branded consumer products, including cigars, rolling papers, cigar wrappers, chewing tobacco, vaping products and more.
- Vector Group Ltd.: See above for company description.
These are the tobacco stocks with the highest total return over the past 12 months.
|Tobacco stocks with the most momentum|
|Price ($)||Market Capitalization ($B)||12 months sequential total return (%)|
|TAAT Global Alternatives Inc. (TAAT.CX)||CA$4.45||CA$0.4||273.9|
|Turning Point Brands Inc. (TPB)||47.58||0.9||54.0|
|Imperial Brands PLC (IMBBY)||21.42||20.3||33.0|
|MSCI ACWI Tobacco Index||N/A||N/A||25.0|
- TAAT Global Alternatives Inc.: TAAT Global Alternatives is a Canada-based health and wellness company. TAAT produces hemp-based tobacco alternatives that are nicotine and tobacco free. In early September, the company announced that its new facilities in the Las Vegas, Nevada area were operational, providing significant additional operational space and production resources. In recent months, TAAT has announced new purchase orders for distribution in the UK, Ireland and Australia, in addition to distribution in seven new US states.
- Turning Point Brands Inc.: See above for company description.
- Imperial brands PLC: See above for company description.
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Y Charts. “YCharts.” Accessed September 15, 2021.
VectorGroup Ltd.”Vector Group Announces Quarterly Cash Dividend.” Accessed September 15, 2021.
British American Tobacco PLC. “British American Tobacco has negotiated bribes for Mugabe, new evidence shows.” Accessed September 15, 2021.
RLX Technology Inc.”RLX Technology Announces Second Quarter 2021 Unaudited Financial Results.” Accessed September 15, 2021.
TAAT Global Alternatives Inc.New TAAT™ facilities now operational.” Accessed September 15, 2021.