Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Electronic Cigarettes Shake Up the Tobaco Industry

Companies / Sector Analysis Apr 25, 2014 - 12:32 PM GMT

By: Richard_Cox

Companies

In the last few years, we have seen relatively few examples of true market innovation.  Progress in cell phone, computer, and automobile technology has stalled and this makes it difficult to identify companies that are poised for real growth over the next 5-10 years.  But it looks as though an exception can be made here in the electronic cigarette industry, which has made some major advances in recent years when compared to the traditional cigarette products that have seemingly been around forever.  These innovations will have a major impact not only on the health of cigarette smokers but on the broader trajectory in many areas of the marketplace, as well.  Here, we will look at some of the ways electronic cigarettes will alter the landscape -- both from a health perspective and from a market perspective.  


Cheaper Prices, Healthier Products

From a consumer perspective, electronic cigarettes offer several advantages over their paper alternatives.  Smoking electronic cigarettes, or e-cigarettes, is far cheaper in terms of price, healthier for the primary smoker, and safer for those in the secondary field of view.  “When smoking an e-cigarette, you are not dealing with an open flame because nothing is being burned,” said Sam Hadi at CloudCig, producer of Cloud Electronic Cigarettes. “This will likely have a marked impact on the number of fire-related injuries that occur worldwide each year.”  Currently, cigarettes are the number one cause of fire-related deaths, so there are clear safety advantages -- especially in homes with small children.  

From a health perspective, e-cigarettes are widely expected to help reduce the potential for heart attack, stroke, throat cancer, Alzheimer’s osteoporosis, and lung cancer.  The main reason for this comes from the fact that paper cigarettes include many more harmful and carcinogenic chemicals that are not present in the electronic alternatives.  Most of the user surveys have established a marked changed in the overall feeling of health that is seen in regular smokers of both products.  This has prompted a widespread surge in sales, with more than $1 billion in electronic cigarette sales in 2013.  Nearly 2.5 million consumers in the US alone have permanently switched to e-cigarettes, so the trends here are clear and it is unlikely we will see any reversals here any time soon. 

Impact For Companies

Some of the best evidence for the fact that trends in the e-cigarette industry will not be changing can be seen in the recent steps major manufacturers.  Some of the biggest players in the sector have started to divert resources away from traditional paper cigarette products and instead have made key acquisitions of smaller companies that are well-positioned in the electronic space.  Key examples here can be seen in Altria Group (more commonly known by its former name, Philip-Morris), British-American Tobacco, and Lorillard.  So far, most of the innovation has been seen in much smaller companies. 

But all three of these blue chip names have purchased some of the strongest selections in order to build on the research and development that is already in place.  Altria’s purchase of e-vape company Green Smoke (through its NuMark subsidiary) is the latest example of this type of activity.  Altria has already released its first product, the MarkTen, but it is still only available in limited markets.  Provided that the broader sales trends continue to perform above and beyond the analyst expectations, this product offering will continue to expand and generate additional sales for the company. 

All in all, the innovative products that are now being offered by e-cigarette companies have a variety of benefits and will continue to have drastic implications for what is seen in the marketplace as a whole.  Innovations of this magnitude are relatively rare when we look at the last few years.  But the implications here are huge, in terms of consumer pricing, potential corporate earning, safety and personal health. 

By Richard Cox

© 2014 Richard Cox - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in