The tobacco industry is going smoke-free - how to profit from it

Tobacco companies have realised their traditional products are on the wane. But new opportunities have opened up – and should prove lucrative

Metal gray ashtray filled with smoked cigarettes
(Image credit: Getty Images)

Tobacco is one of the world’s most divisive sectors. Ever since the first link between smoking and cancer was established in 1950, the companies that produce and sell cigarettes have been under pressure. The pressure intensified in the mid-1950s when the first lawsuits were filed against the US tobacco industry. Over the next 40 years, a steady stream of litigation worked its way through the courts. 

Tobacco companies successfully defended their position until the mid-1990s, when more than 40 US states started litigation against the industry. The battles ended with the Tobacco Master Settlement Agreement (MSA), agreed on 23 November 1998, between the four largest US tobacco companies (Philip Morris, R. J. Reynolds, Brown & Williamson and Lorillard) and the attorney generals of 46 states. 

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Rupert Hargreaves
Contributor and former deputy digital editor of MoneyWeek

Rupert is the former deputy digital editor of MoneyWeek. He's an active investor and has always been fascinated by the world of business and investing. His style has been heavily influenced by US investors Warren Buffett and Philip Carret. He is always looking for high-quality growth opportunities trading at a reasonable price, preferring cash generative businesses with strong balance sheets over blue-sky growth stocks.

Rupert has written for many UK and international publications including the Motley Fool, Gurufocus and ValueWalk, aimed at a range of readers; from the first timers to experienced high-net-worth individuals. Rupert has also founded and managed several businesses, including the New York-based hedge fund newsletter, Hidden Value Stocks. He has written over 20 ebooks and appeared as an expert commentator on the BBC World Service.