Coverage of this marijuana stock was also recently initiated at Buckingham and B. Riley, with ‘Buy’ ratings. The company beat analysts’ EPS estimates by $0.11 last quarter.
Turning Point Brands, Inc. (TPB)
From Cabot Marijuana Investor
Turning Point Brands, Inc. (TPB) is a conservative way to invest in the 2020 rebound of the most battered market sector of 2019—marijuana stocks. Obviously, this is a very aggressive and high-risk sector. Many institutions won’t even touch marijuana stocks because of continuing federal illegality and most investors won’t touch them because volatility is high, and liquidity is low.
But with the sector off nearly 50% from its 2019 high, there’s great potential for a rebound, and Turning Point is a low-risk way to play it. This well-managed company, headquartered in Kentucky, has a stable, profitable business in smokeless tobacco (snuff and chewing tobacco) that supports a dividend of 0.7%. But in recent years, Turning Point has been diversifying into the marijuana business, first by marketing vaping supplies and then by peddling CBD, activities which are totally legal across the U.S.
In 2019, the vaping crisis (mainly attributable to black market THC devices) hit the stock hard, but it rebounded strongly in late October. Since then, it’s been building a base that looks like a great entry point as we wait for a resumption of the stock’s uptrend.
Timothy Lutts, Cabot Marijuana Investor, www.cabotwealth.com, 978-745-5532, December 23, 2019