Odd Lots How Tobacco Became One Of The Greatest Investments In History
Oct 15, 2020
Financial advisors Lawrence Hamtil, known for his contrarian strategies, and Gene Hoots, author of "Going Down Tobacco Road," delve into the surprising success of tobacco investments. They discuss how tobacco stocks have outperformed others consistently for over a century and explore the industry's evolution from diverse origins to a few dominant players. Key topics include the resilience of tobacco amidst regulatory challenges, the growing competition from vaping and cannabis, and the impact of ESG factors shaping investment decisions in this controversial sector.
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Tobacco's Unexpected Success
- Tobacco stocks have been extraordinary winners for years, despite efforts to curb smoking.
- This consistent outperformance, even with headwinds like taxes and lawsuits, makes them unique.
Consistent Tobacco Returns
- Tobacco stocks have a history of consistent returns, even during periods when other sectors struggle.
- Unlike tech companies, tobacco has never had a negative 10-year period in total return.
Addictive Product, Loyal Customers
- The tobacco industry's success stems from selling an addictive product with strong brand loyalty.
- One example is a Camel smoker who stocked her freezer with cigarettes, refusing filtered versions.
