https://www.cnbc.com/2019/09/25/juul-ceo-kevin-burns-to-step-down-replaced-by-former-altria-exec-kc-crosthwaite.html
Over the past several months JUUL has been under constant scrutiny from the FDA and public eye. There have been nearly 1000 vaping related illnesses and 9 death, although hardly any of the illnesses can be linked to JUUL, the company is still the face of the vaping industry. In the heat of the battle against vaping, the JUUL CEO has decided to step down. On top of this several states have put a temporary ban on vaping products. JUUL officials estimate that they will lose 80% of their revenue if flavored pods are banned. A CEO stepping down and a potential 80% hit to revenue is a large concern for the private investors for JUUL. Do you think investors will start looking to the tobacco industry in the midst of this vaping controversy (will tobacco stocks soon rise)?
I think it is a good idea for investors to look towards the tobacco industry, but I do think that it will only be a temporary rise. This is a massive blow to an industry that blew up over the past couple years. It will be interesting to see what other smoking alternatives there will be now.
ReplyDeleteWith more people paying attention to the vaping illnesses more light might also be shined on the harms of smoking. So in that way the backlash may also hurt the tobacco industry. At the same time banning juuls may lead more people to cigarettes so in that way it could work out for the tobacco industry.
ReplyDeleteI think that this is a great time for people and business's to invest in the Cannabis industry. People will look at the Tobacco industry as bad since there is usually a correlation between Nicotine and Tobacco, and since Juul Contains Nicotine and has been in the news lately people will step away from both industry's and look for a new one to invest in. Especially since there has been more and more news that Cannabis and Medical Marijuana have positive health effects.
ReplyDeleteI agree, I do not think the question is if the JUUL investors will go to tobacco, I think they will switch to cannabis. It is becoming a more and more popular industry in the world day by day while tobacco is still seen as "gross" for most people.
DeleteSince flavored vaping products are getting pulled from shelves, I would not be shocked if we saw an increase in Tobacco stocks being that there is a lot of uncertainty around vaping.
ReplyDeleteI agree that the tobacco industry will rise as a result to all of the health concern allegations associated with vaping products, particularity with JUUL products. With the flavor pods possibly being banned then I believe that consumers will find a different product due to the addictiveness of nicotine in this products. Therefore, tobacco industry will grow.
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