• June 15, 2024

Sensing a whiff of marijuana

 Sensing a whiff of marijuana

Writing at fool.com, Leo Sun recently asked whether Altria will start selling marijuana and forget about electronic cigarettes.
Sun noted that Altria shares had risen nearly seven percent on September 12 after executive vice president and general counsel Murray Garnick had discussed the cannabis market at the Barclays 2018 Consumer Staples Conference. Garnick was reported to have said that Altria was “exploring options” and “evaluating market opportunities,” though only after Barclays analyst Gaurav Jain had prodded Altria on the issue.
But that suggestion seemed to offset a negative development regarding Altria’s e-cigarette business, which appeared under threat after the US Food and Drug Administration issued a warning to tobacco companies that it would pull their e-cigarettes from retail shelves if they didn’t make more changes to curb the use of these products by young people.
In a long piece that ranges over Altria’s traditional tobacco business, its vapor business and the possibility of its entering the marijuana business, Sun admitted that it seemed like a big leap for a major tobacco seller to start selling cannabis, though he noted that at least one tobacco dealer and one manufacturer had already dipped their toes in the market.
However, he said these investments didn’t mean that tobacco makers would start rolling joints at their factories.
‘For now, investors should realize that neither the cannabis nor e-cig headlines will have much of an impact on Altria’s growth,’ Sun said. ‘Instead, they should focus on the FDA’s proposals for lower-nicotine cigarettes – which could deal serious damage to its core business.’