5 Best Tobacco and Cigarette Stocks To Buy

In this article, we discuss 5 best tobacco and cigarette stocks to buy. If you want to see more stocks in this selection, check out 10 Best Tobacco and Cigarette Stocks To Buy. 

5. WM Technology, Inc. (NASDAQ:MAPS)

Number of Hedge Fund Holders: 15

WM Technology, Inc. (NASDAQ:MAPS) is a California-based company providing ecommerce and compliance software solutions to retailers and brands in the cannabis market in the United States, Canada, and internationally. It is one of the best tobacco stocks to buy. The company offers Weedmaps marketplace, enabling cannabis users to browse cannabis products from retailers and brands, as well as reserve products from local retailers. 

On November 8, Canaccord analyst David Hynes maintained a Buy rating on WM Technology, Inc. (NASDAQ:MAPS) but lowered the firm’s price target on the shares to $4.75 from $6. The analyst said that the firm is doing what it can in a tough market.

According to Insider Monkey’s Q3 data, 15 hedge funds held stakes worth $26.8 million in WM Technology, Inc. (NASDAQ:MAPS), compared to 14 funds in the prior quarter worth $47.7 million. Richard Mashaal’s Rima Senvest Management is the biggest stakeholder of the company, with 7.35 million shares worth $11.8 million. 

4. Tilray Brands, Inc. (NASDAQ:TLRY)

Number of Hedge Fund Holders: 16

Tilray Brands, Inc. (NASDAQ:TLRY) is a New York-based pharmaceutical, cannabis-lifestyle, and consumer packaged goods company, with operations in Canada, Australia, New Zealand, and Latin America. The company also has growing facilities in Germany and Portugal. On November 7, Tilray Brands, Inc. (NASDAQ:TLRY) announced the acquisition of Montauk Brewing Company, a craft brewer in Metro New York. The acquisition is expected to be accretive to Tilray Brands, Inc. (NASDAQ:TLRY)’s adjusted EBITDA. Tilray is moving into the alcohol business by acquiring breweries and distilleries. 

On November 1, Bernstein analyst Nadine Sarwat initiated coverage of Tilray Brands, Inc. (NASDAQ:TLRY) with a Market Perform rating and a $3.90 price target. Tilray Brands, Inc. (NASDAQ:TLRY)’s cannabis business has “best-in-class” gross margins and should be free cash flow positive this fiscal year, the analyst told investors in a research note. However, like other huge licensed producers, Tilray Brands, Inc. (NASDAQ:TLRY) has suffered from significant share loss in Canadian cannabis, noted the analyst. He said that he would be more bullish if Tilray Brands, Inc. (NASDAQ:TLRY) regains meaningful share in Canada and/or Germany legalizes recreational cannabis.

According to Insider Monkey’s data, 16 hedge funds were bullish on Tilray Brands, Inc. (NASDAQ:TLRY) at the end of Q3 2022, compared to 14 funds in the last quarter. D E Shaw is a prominent stakeholder of the company, with 3.4 million shares worth $9.3 million. 

3. Imperial Brands PLC (OTC:IMBBY)

Number of Hedge Fund Holders: N/A

Imperial Brands PLC (OTC:IMBBY) was founded in 1636 and is based in Bristol, the United Kingdom. The company manufactures, imports, markets, and sells tobacco and tobacco-related products in Europe, the Americas, Africa, Asia, and Australasia. Imperial Brands PLC (OTC:IMBBY) provides cigarettes, fine cut tobacco, rolling papers, cigars, traditional oral tobacco, e-vapour products, oral nicotine, and heated tobacco products. It is one of the best tobacco stocks to invest in. 

On November 17, Societe Generale analyst Jonathan Leinster raised the price target on Imperial Brands PLC (OTC:IMBBY) to 2,230 GBp from 2,175 GBp and kept a Buy rating on the shares.

2. The Scotts Miracle-Gro Company (NYSE:SMG)

Number of Hedge Fund Holders: 29

The Scotts Miracle-Gro Company (NYSE:SMG) was founded in 1868 and is headquartered in Marysville, Ohio. The Scotts Miracle-Gro Company (NYSE:SMG) provides cannabis products under its Hawthorne division. The company paid a $0.66 per share quarterly dividend to shareholders on December 9. The dividend yield on December 15 came in at 5.22%. 

On November 8, Barclays analyst Gaurav Jain upgraded The Scotts Miracle-Gro Company (NYSE:SMG) to Overweight from Equal Weight with an unchanged price target of $75. The analyst expects The Scotts Miracle-Gro Company (NYSE:SMG) to “delever rapidly from here,” even under multiple different macro scenarios. Over the next three years, the company should deliver $6-$8 per share in free cash flow, the analyst wrote in a research note. He cited the stock’s 16% free cash flow yield for the upgrade.

According to Insider Monkey’s Q3 data, The Scotts Miracle-Gro Company (NYSE:SMG) was part of 29 hedge fund portfolios, compared to 25 in the prior quarter. Jean-Marie Eveillard’s First Eagle Investment Management is the leading position holder in the company, with 1.5 million shares worth $67.3 million. 

1. Philip Morris International Inc. (NYSE:PM)

Number of Hedge Fund Holders: 63

Philip Morris International Inc. (NYSE:PM) is one of the premier tobacco stocks to invest in. The company’s portfolio includes cigarettes and smoke-free products like heat-not-burn, vapor, and oral nicotine products. On December 8, Philip Morris International Inc. (NYSE:PM) declared a $1.27 per share quarterly dividend, in line with previous. The dividend is payable on January 11, 2023 to shareholders of record on December 22. The dividend yield on December 15 came in at 4.96%. 

On December 15, Citi analyst Simon Hales resumed coverage of Philip Morris International Inc. (NYSE:PM) with a Neutral rating and a $109 price target after the company concluded the acquisition of Swedish Match. The analyst believes Philip Morris International Inc. (NYSE:PM) will be able to leverage Swedish Match’s route-to-market in the U.S. to roll-out its IQOS products. However, the potential exit from Russia will pressure the company’s headline earnings in 2023 and its pro-forma valuations are at five-year P/E relative highs, the analyst told investors in a research note.

According to Insider Monkey’s data, 63 hedge funds reported owning stakes in Philip Morris International Inc. (NYSE:PM) at the end of Q3 2022, compared to 56 funds in the prior quarter. Rajiv Jain’s GQG Partners is the largest stakeholder of the company, with 17.4 million shares worth $1.4 billion. 

Here is what Coho Relative Value Equity Fund has to say about Philip Morris International Inc. (NYSE:PM) in its Q3 2022 investor letter:

“Coho is not immune to the earnings pressure exerted by a strong USD, although the portfolio on the whole has modestly less foreign revenue exposure relative to the S&P 500 Index. The two most impacted Coho stocks includes Philip Morris International, which essentially derives all of its revenues outside the U.S. Harkening back to Table 1, the decline in Philip Morris earnings for 2022 versus the reported earnings in 2021 is entirely related to the strengthening dollar. On a constant currency basis, Philip Morris’ earnings in 2022 would be up mid to high single digits.”

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