Back to top

Analyst Blog

Lorillard, Inc. (LO - Analyst Report) came out in support of the recently signed law, which prevents minors from buying electronic cigarettes. The legislation was signed into law by Kentucky Governor Steve Beshear and sets an example of responsible regulation. However, the company believes that the law should also be passed by all the states to prohibit the selling, furnishing and distribution of electronic cigarettes to minors.

E-cigarettes are becoming increasingly popular, especially among youngsters due to rising health concerns related to traditional cigarettes. These battery-powered devices turn a nicotine-based liquid into vapor. These were considered less harmful than traditional tobacco products and, therefore, major tobacco players like Lorillard, Philip Morris International Inc. (PM - Analyst Report), Reynolds American Inc. (RAI - Analyst Report) and Altria Group Inc. (MO - Analyst Report) capitalized on them. Lorillard’s blu eCig and SKYCIG brands, Reynolds’ Vuse and Altria’s MarkTen and Nu Mark brands have a strong foothold in the category. In Nov 2013, Philip Morris announced that it would enter the e-cigarette business in late 2015.

However, e-cigarettes are being strictly scrutinized by health regulators nowadays. In Mar 2014, the European Parliament imposed stronger rules on e-cigarettes, which state that e-cigarettes, with nicotine strength of more than 20 milligrams per milliliter, would need authorization as a medicine. Moreover, curative or preventive qualities of these products need to be proved. E-cigarettes below this level will face the same regulations as conventional tobacco products if their usage as a medicinal product cannot be proved.

These rules will pose a problem for the tobacco giants, which are already facing challenges in the form of strict anti-smoking campaigns launched by governments around the world. Tobacco companies are increasingly relying on packaging to build brand loyalty and grab consumer attention, especially after the government curbed advertising in magazines, and on billboards and TV.

However, it is also the responsibility of these tobacco companies to discourage youngsters from smoking cigarettes or e-cigarettes.

Lorillard currently has a Zacks Rank #3 (Hold).

Read the Full Research Report on MO
Read the Full Research Report on PM
Read the Full Research Report on RAI
Read the Full Research Report on LO

Zacks Investment Research

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
SUPER MICRO… SMCI 27.00 +10.25%
CANADIAN SO… CSIQ 38.34 +8.18%
BANCO DO BR… BDORY 16.78 +8.05%
CENTURY ALU… CENX 26.97 +7.97%
WILLDAN GRO… WLDN 11.38 +5.86%