How Is Turning Point Brands’ Revenue Likely To Grow In Next 2 Years?
Turning Point Brands (NYSE: TPB) is an independent provider of Other Tobacco Products (OTP) in the United States. The company operates in three segments: Smokeless Products, Smoking Products, and NewGen Products. The company sells a range of products across the OTP spectrum, including moist snuff tobacco (MST), loose leaf chewing tobacco, premium cigarette papers, make-your-own (MYO) cigar wraps, liquid vapor products, and tobacco vaporizer products. TPB’s portfolio of brands includes Zig-Zag, Beech-Nut, Stoker’s, Trophy, and VaporBeast.
Turning Point Brands’ impressive performance in 2017 has placed itself in a good position to succeed in the coming years, by continuing the execution of its strategic plan. Consequently, we have estimated a revenue growth at a CAGR of 4.8% in the next two years for TPB. We have created an interactive dashboard which shows the forecast trends. You can modify the different revenue drivers to see how it will impact the company’s expected revenues.
- Will United Airlines Stock Continue To See Higher Levels After A 20% Rise Post Upbeat Q1?
- Up 8% This Year, Why Is Costco Stock Outperforming?
- Down 7% In A Day, Where Is Travelers Stock Headed?
- What’s Next For Johnson & Johnson Stock After Beating Q1 Earnings?
- Should You Pick UnitedHealth Stock At $480 After A Q1 Beat?
- American Express Stock Is Up 17% YTD, What To Expect From Q1?
In the Smokeless Products segment, the company has managed to increase revenues consistently, spurred by market share capture in both chewing tobacco and MST. The company’s continued expansion of Stokers 1.2 ounce MST cans and the smokeless tobacco brands it acquired in 2016 being in a greater number of retail outlets will help to drive revenues going forward, as a result of which we expect a CAGR of 8% for Smokeless Products revenues.
TPB witnessed declining revenue in the Smoking Products segment in 2017 due to a de-emphasis on cigars, stemming from a highly competitive environment which caused pricing pressure. Moreover, the implementation of a 65% excise tax on MYO cigar wraps in California also weighed on the volumes. While we expect these trends to continue, sales of rolling paper and MYO cigar wraps could see an improvement as a result of the marijuana legalization in some states. Consequently, flat revenue growth is expected for 2018, and a moderate decline in 2019.
NewGen Products segment’s success in 2017 was a result of the acquisition of VaporBeast in the fourth quarter of 2016 and of VaporShark in the middle of 2017. These acquisitions are expected to drive revenue growth going forward, at a CAGR of approximately 8%.
What’s behind Trefis? See How It’s Powering New Collaboration and What-Ifs
For CFOs and Finance Teams | Product, R&D, and Marketing Teams
Like our charts? Explore example interactive dashboards and create your own.