Friday, January 27, 2017

Is Tobacco On Fire?

With the recently revised merger between British American Tobacco(BTI) & Reynolds America(RAI) I thought it'd be a good idea to review the performance of our other
tobacco holdings.  Some of which have been on fire the last couple months.


Here is a chart depicting the performance of Altria(MO), Phillip Morris(PM), Vector Group(VGR), and Universal Corp(UVV)


Visit StockCharts.com to see more great charts.

All show strong performances, but what's noteworthy is the huge run we've seen in one of our lesser known holdings Universal Corp(UVV) with a 34% gain since December 2016. A lot of this run up is due to the increased expectations for the vaping sector. Universal is a supplier of liquid nicotine and other components for vaping liquids. The company is more of a pure play on this trend than the major tobacco companies which will have to compete amongst themselves. Also UVV has already positioned itself as a major supplier for the big tobacco companies.

Here is the performance for all tobacco holdings since December 2016

 UVV - 37.39%
 RAI - 12.15%
 MO - 11.83%
VGR - 7.48%
PM - 10.41%
BTI - 13.51%

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