At $41.50, Altria shares are trading at an 8.9x P/E and an 11.3% Free Cash Flow ("FCF") Yield (normalized), relative to 2021 financials: Relative to the midpoint of the reaffirmed 2022 EPS guidance ($4.79-4.93), Altria's P/E multiple is 8.5x. Altria targets an 80% Payout Ratio, and the dividend was raised 4.7% in August 2021. Juul and other companies were permitted to continue selling tobacco- and menthol-flavored cartridges but only while the FDA reviewed their marketing applications. "There's overwhelming evidence that the behavior of Juul contributed to the product being sold to youth," says Dr. Robert Jackler, a professor and the principal investigator at Stanford Research Into the Impact of Tobacco Advertising at the university's medical school. Students are not using Juuls anymore because no one wants menthol or tobacco.. Juul's growth is dilutive to Altria's earnings. I/we have a beneficial long position in the shares of PM,SWMAY either through stock ownership, options, or other derivatives. First hearing scheduled next Mon (Jun 27). The FDA Postpones A Long-Awaited Decision On Juul's Vaping Products And in a statement, American Vaping Association President Gregory Conley said it is absolutely absurd that the same agency that found time to ban over six million vaping products manufactured by small businesses is now indicating they need more time to review products with massive market shares.. The Food and Drug Administration on Thursday ordered Juul to stop selling e-cigarettes on the U.S. market, a profoundly damaging blow to a once-popular company whose brand was . Meanwhile, a federal study published last Fall found Juul had already fallen to fourth place among high school vapers, behind Puff Bar, Vuse, and Smok. The Wall Street Journal first reported that the FDA was ordering Juul products off the market. The much-publicized exemption allows menthol and tobacco flavors. Schools and health officials across the U.S. are struggling to curb what they say is an epidemic of underage vaping. "They want groups like ours to call for a ban on all Chinese vapes so that they can take over the market," said Fuhrman, of Parents Against Vaping E-cigarettes. remains a distant #2 behind Swedish Match's ZYN. And the pods are twice as big and half the price as Juul. Juul submitted its applications two years ago, including reams of scientific studies and other materials trying to make the case that its e-cigarettes help adults quit smoking without attracting young users. With shares at $41.50, we expect an exit price of $62 and a total return of 87% (22.7% annualized) by 2025 year-end. Ever feel like a plastic bag, drifting through the wind, wanting to Juul again? Without the data needed to determine relevant health risks, the FDA is issuing these marketing denial orders.. In 2011, the proportion was just 1.5%. We remain committed to doing all in our power to continue serving the millions of American adult smokers who have successfully used our products to transition away from combustible cigarettes, which remain available on market shelves nationwide.. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Juuls innovative approach, touted in early marketing videos featuring young models partying and puffing on e-cigarettes, revolutionized the sleepy vaping industry. Nearly 50 companies have sued the FDA because of its decisions on their products. If that's the case, then the cigarette market likely will see significant erosion of demand and, if I'm not mistaken, that's the business Altria is in? Massachusetts, New York and Rhode Island later enacted permanent bans. It said at that time it is still evaluating the companys application for menthol-flavored products for Vuse Solo. They equate to about 1 percent of our sales, if that, said Jon Roundy, the owner of Tasty Haze, LLC, a vape shop in Rainbow City, Ala. Roundy was among the vape shop owners who received FDA bans on all of his flavored products Thursday. U.S. Nicotine Industry Category Share by Value. A U.S. ban on Juul products would free Altria from its current non-compete in e-vapor. exempted them.. While it's true e-cigarettes don't produce tar, in which most of the cancer-causing chemicals from tobacco smoke are found, both products contain nicotine, which is highly addictive and can harm the developing brains of adolescents, health officials note. Altria can potentially expand its efforts in selling IQOS in the U.S., though this will not directly address the e-vapor market. nicotine pouches, but this also will not directly address the e-vapor market. I'm still seeing Vuse Alto mixed berry everywhere but rarely anything like that from Juul. When the Trump administration decided to prohibit fruit, mint and dessert flavors in refillable cartridge-based e-cigarettes like Juul, it carved out a few exceptions to mollify the vape shop owners and adult consumers who complained. As part of that process, the company reduced its product portfolio, halted television, print and digital product advertising, built up its science and evidence-based capabilities, and supported the Trump administrations final flavor policy for ENDS products, while taking a methodical approach to its global presence, the company said. The agencys decision against blanket enforcement drew criticism from health groups. The Dividend Yield is 8.7%, with Altria stock currently paying a dividend of $0.90 per quarter ($3.60 annualized). Vuse's value share was 36.0% (based on closed systems only, so excludes open-tank e-vapor products) in December 2021, and was virtually unchanged for January-April 2022 at 35.9%. This week, the FDA also announced plans to cap nicotine levels in cigarettes to make them. Concern. Given the political pressure brought to bear by tobacco-control groups, parent groups and members of Congress to ban Juul, one wonders whether this decision was solely based on safety, said Clifford E. Douglas, director of the University of Michigans Tobacco Research Network and former vice president for tobacco control at the American Cancer Society. The Food and Drug Administration on Thursday banned the sale of Juul Labs vaping products in the U.S., citing "insufficient and conflicting data." The decision, part of the agency's broader. Juul said it submitted enough information and data to address all issues raised. | (Nam Y. Huh, File/AP Photo). When you say that a product is for an adult, the message is not, 'Don't use.' Recently, Vuse Alto e-cigarettes, owned by Reynolds American tobacco company, has edged past Juul in terms of market share of cartridge-based brands in the United States. Anti-vaping groups note that the company's Vuse, which is still available in menthol, was the second most popular e-cigarette among teens last year. In October, the FDA issued a landmark ruling in approving Reynolds Vapors tobacco flavor of the Vuse Solo closed electronic nicotine delivery system, its power unit and two replacement cartridges. Cowen & Co. analyst Vivian Azer wrote in an investors note that the focus from the agency was on toxicology, which varies from the marketing denial orders that Imperial Brands received on myblu., While Imperial has opted to stay on the market through the appeal process, Juul may have a harder time pursuing that route, given the potential liability. The testimonial ads feature adults describing the positive changes in their lives after they gave up smoking cigarettes to use Juul. Please subscribe to keep reading. If people just sold straight tobacco flavor vapes, people would want to wean themselves off, he said. Article Juul, the once-booming Silicon Valley start-up widely blamed for igniting the youth vaping epidemic, was grounded Thursday by federal regulators who ordered all of its e-cigarette. E-vapor's impact on U.S. cigarette volumes has also been limited to date. The agency said in an Aug. 26 statement that menthol e-cigs raise unique considerations, and tobacco and menthol reusable e-cigarettes are currently allowed on the market. Altria: No Reason To Panic On Rumored FDA Ban On Juul - Seeking Alpha The pre-charged, pre-filled devices are made by domestic companies and imported from China. The fate of e-cigarette products with flavors like tobacco and menthol is unclear. If you have an ad-blocker enabled you may be blocked from proceeding. The company halted television, print and digital advertising. Compared to when we upgraded our rating to Buy in February 2020, Altria's share price is now 13% lower, though including dividends our rating has still generated a gain of 4%. We recognize these make up a significant part of the available products and many have played a disproportionate role in the rise in youth vaping., The FDA said part of its decision was based on insufficient and conflicting data from Juul that have not been adequately addressed and precluded the FDA from completing a full toxicological risk assessment of the products named in the companys applications.. Email notifications are only sent once a day, and only if there are new matching items. For nearly 50 years, cigarette advertising has been banned from TV and radio. 3 is NJoy at 3%, while No.4 is Fontem Ventures blu eCigs, at 1.9%. BAT has received MGOs on some Vuse Solo, Vuse Ciro and Vuse Vibe products, but the application for its most popular Vuse Alto products remains pending. The FDA cannot and will not enforce against individual consumer possession or use of Juul products or any other tobacco products, the agency said. The device is a bit chinsy compared to a Juul, but also just $1 including a charger. FDA delays Juul decision, rejects 950K vaping product applications Since launching its product in 2015, Juul Labs, based in San Francisco, has come to dominate the e-cigarette market, now accounting for 75% of e-cig sales at convenience stores and mass retail outlets, according to Bonnie Herzog, a senior analyst at Wells Fargo Securities. Anti-vaping advocates praised the FDAs ruling. However, developing a new e-vapor product "would take years", partly due to the need for new PMTA applications - this was the internal view within Altria prior to their investment in Juul, as disclosed in court documents from the FTC case. Young people, these critics of e-cigarettes note, are continuing to post about Juul on those sites. As of Thursday, it had issued 132 marketing denial orders that covered roughly 946,000 flavored e-cigarette products. President Trump needs to grow a spine and enact the real flavor ban he promised not this loophole-ridden version that was tailor-made to appease the vaping industry.. Vuse Mixed Berry, but no Juul Flavors? : juul Juul, more than any other product or company, has been responsible for creating and fueling the youth e-cigarette epidemic.. The Food and Drug Administration announced Thursday that Juul Labs Inc. is required to remove all electronic cigarette products from U.S. shelves. (TPB e-vapor products have remained on the market.) The majority of companies that received market denial orders so far have been small and medium-sized companies. It's 'Use these products and you'll appear to be adult or mature. Juul was fourth. They are its tobacco-flavored disposable e-cigarettes in Daily rich 4.5% and Daily extra rich 6% the percentages are for nicotine content. "The kids are doing their work for them.". Juul uses benzoic acid, though their patent covers a wide range of other acids as well. In August, the agency sent a refused to file notice to a company whose application covered 4.5 million products but was missing key information. Its basically like smoking a Juul., Daniella said she is trying to quit, but has not yet succeeded although she is down from vaping all day long to taking just a few hits in the morning and a few more before bed. Came here for an honest review of juul vs vuse since this whole ban. Unfortunately Altria's strategic options in Reduced Risk Products are limited regardless of the outcome on Juul. "We want adult smokers to hear directly from former adult smokers that Juul Labs provides a true alternative to combustible cigarettes and is showing unprecedented success, with studies showing 40 to 56% of adult smokers fully switching within 90 days of use," Kwong says. Because the decision was based on safety reasons, Myers said, it does not address Juuls role in driving the youth vaping epidemic and the continued role of flavored e-cigarettes, including menthol-flavored products sold by Juul and other manufacturers, in sustaining youth e-cigarette use. He called on the FDA to deny applications for all flavored e-cigarettes, including other menthol-flavored products and the disposable vapes that have become increasingly popular with young people. Even though products like JUUL are technically being marketed illegally, FDA signaled that it will not take imminent action to remove them, said Lee Savio Beers, the president of the American Academy of Pediatrics, in a statement. He also smokes cigarettes, and says that rather than replacing traditional cigarettes, the e-cigarettes increase his cravings to smoke. Please check and try again. Any administration that was serious about protecting children from nicotine addiction would realize that disposable e-cigarettes are the last thing we should be leaving on the market, Senator Merkley said in an email. The CDC said 1 in 20 middle school students, those in grades 6 through 8, reported vaping in the previous 30 days. Workers save turtles on migration path through dry-cleaning business. "Additional cross-category movement" peaked at 2.1% in Q3 2019, largely attributed to Juul's previous explosive growth, but fell dramatically after the FDA's clampdown on flavored e-vapor products in late 2019 and never recovered: U.S. Cigarette Industry Volume Decline by Component (Rolling 12 Months). Still, the FDA said, e-cigarette use remains a concern because more than 2 million middle and high school students reported vaping within the past 30 days. Bear in mind that I speak as a consumer and staunch advocate of vaping technology in general; just not of Juul in particular. We respect the central role of the FDA and the required thorough science- and evidence-based review of our applications, which is key to advancing harm reduction and earning a license to operate, said a spokesperson from Juul. They have the most nicotine content,. What the FDA's Juul ban means for the vaping industry. The current buyback program has $1.2bn remaining after Q1 2022, equivalent to 1.2% of the current market capitalization, and is expected to be executed by 2022 year-end. The FDA is Preparing to Ban Juul E-Cigarettes Dividend Payout to be 79% in 2022, and 80% thereafter, P/E at 11.0x at 2025 year-end (was 12.0x), implying a 6.9% Dividend Yield. Maybe then someone buys them? Juul users will no longer find the sleek vapes in store shelves. However, e-cigarette sales overall have slumped since the FDA implemented its latest round of heightened regulations on the products in February 2020. Out of 262 MDOs listed on the FDA website under the current process, seven have been fully or partially rescinded, and another eight have been granted stays either by a court or by the agency itself. The agency ruled on some of them but did not yet make a decision on products made by Juul. We remain committed to transitioning adult smokers away from combustible cigarettes while combating underage use.. On May 12, the FDA authorized six Vuse products with 1.5% and 3% nicotine levels. The agency said it has not received information to suggest consumers who use Juul products face an immediate hazard. ', Bonnie Halpern-Felsher, developmental psychologist, Stanford. The Food and Drug Administration said it was denying Juuls applications to continue selling the companys e-cigarette device and prefilled cartridges in menthol and tobacco flavors. Altria may be able to license an e-vapor product from Philip Morris. A store in New York City selling Juul products. Turning Point Brands (TPB) received MDOs on its e-vapor products in September 2021 under the same process, and challenged this in court, and by October the FDA had rescinded its MDOs and agreed to review TPB's PMTA again. Steven Senne/AP Altria may actually stand to gain, as Juul's growth has been dilutive to its earnings, and other e-vapor companies may also face bans. Regarding the disposables, Mr. Smith said, These products are not being used by youth which is why the F.D.A. Steins lawsuit targeted Juuls business and marketing practices, most notably accusing Juul of violating the states Unfair and Deceptive Trade Practices Act. As the Feb. 6 effective date for the federal flavor ban nears, companies are advertising big sales on their flavors. The FDA said Thursday that it has authorized 23 electronic nicotine delivery system products. Should Juul products disappear from the U.S. market, Altria will likely see an immediate benefit in volume and earnings. But the exemption for disposable e-cigarettes was unexpected. While last-twelve-month industry volume decline has accelerated to 6.0% again, Altria has attributed this to "macroeconomic & other factors", including higher gasoline prices and post-COVID normalization in consumer behavior (which contributed up to 4% to volume during the pandemic). 3 yr. ago That's a good point. In a recent conversation with our chief technology officera leading world expert on how to use AI for educational technologiesI asked him why he thought GPT-4 would be an . What's Behind A Cluster Of Vaping-Related Hospitalizations? As of Q1 2021, the last quarter when IQOS was on sale in the U.S., it had a share of approx. By the time we get the data on disposables, for all we know, there will be a new product that youth are using., Sheila Kaplan is a prize-winning investigative reporter who covers the Food and Drug Administration, the tobacco industry and the intersection of money, medicine and politics. More than 500 companies submitted applications for 6.5 million vaping products to the FDA. EPS +2.4% y/y, Altria marked down value of Juul investment further in 22Q2, by $1.2bn to $450m (original cost: $12.8bn). "We're not calling for that. Mostly with the Golden Tobacco ones, not super often. FDA says more than 5 million electronic cigarettes must be - POLITICO had this footnote that does carve out a loophole, said Kevin Schroth, a professor at Rutgers Center for Tobacco Studies. FDA orders Juul Labs to remove products from US market | CNN A distant No. In the FDAs statement, Michele Mital, acting director of the FDA tobacco center, said Juul was given an opportunity to respond to the agencys questions but instead left us with significant questions. The short answer: Because it can. What Are You Going To Do Without The Juul? Tell Us Your Story. What we know and what we may never know about why the FDA banned Juul. . retains the ability to take action against manufacturers and sellers of disposable e-cigarettes who fail to keep them away from minors. You can cancel at any time. I wrote this article myself, and it expresses my own opinions. Gregory Conley, president of the American Vaping Association, asserted on Twitter that the Juul decisions were manufactured and complete nonsense.. With Juul electronic cigarettes potentially banned, Reynolds' Vuse will Since 2020 PM has launched its new e-vapor product, VEEV, in several non-U.S. markets with good initial results. The agency has deferred its decision on the largest vaping companies, including Juul. In contrast, 3% of adults said they used e-cigarettes in 2017, according to the CDC. British American Tobacco Plc, parent company of Reynolds, said in a May 12 statement these authorizations represent the broadest portfolio of market authorizations provided to any company in the U.S., The FDA said it has not received clinical information to suggest an immediate hazard associated with the use of the Juul device or Juulpods. The company was feeling so much pressure it voluntarily discontinued all its flavors but menthol and tobacco last fall. Neither Puff Bar nor the other companies returned inquiries seeking comment. The Vuse Alto PMTA was submitted nearly a year after Vuse Solo, and five months after Vuse Vibe and Ciro. The ban is the result of an FDA order in . On Juul, there were clearly questions and concerns raised in the agencys mind that the company was unable to resolve, Zeller said. Matthew L. Myers, president of the Campaign for Tobacco-Free Kids, called the FDA decision the most significant action the FDA has taken to reverse the youth e-cigarette epidemic. Altria has "the option to be released from its non-compete obligation if Juul is prohibited by federal law from selling e-vapor products in the U.S. for at least a year", or if the value of its Juul stakes falls below $1.28bn, thanks to a 2020 revision in their agreement. Maybe not, regardless, this is your home for all things Juul and vape related! On April 27, the FDA authorized NJoy Ace styles: its closed e-cigarette device and three accompanying tobacco-flavored e-liquid pods Classic Tobacco 2.4%, Classic Tobacco 5% and Rich Tobacco 5%. Costing between $7 and $10 per disposable e-cigarette, Puff Bar is cheaper than Juul. 7% of the U.S. nicotine market by value, compared to combustible cigarettes' 83% - which means every 10% growth in e-vapor is only equivalent to a 0.8% decline in combustible cigarettes (before any offset by cigarette price rises). CNN . Why GPT-4 Really Is A GiftBut Still Not Enough "When you say that a product is for an adult, the message is not, 'Don't use'," Halpern-Felsher says. The U.S. Food and Drug Administration on Thursday banned the . However, the Juul excels in the flavor department, offering eight flavors as opposed to . In addition, those currently on the U.S. market must be removed, or risk enforcement action.. The rejection of Juuls applications is a stunning blow for a company whose popularity skyrocketed after its 2015 introduction of a sleek vaping device which looked like a flash drive and prefilled nicotine pods in flavors such as creme brulee, mango and cucumber. Reddit banned any sub that is vape brand specific because since it's vape brand specific it is looked at as a marketing sub and marketing = selling. Historically, FDA actions on tobacco products have nearly always been challenged in the courts and often defeated. Its rampant, Kristina Rodgers, the principal of Roosevelt High School in Seattle, said of the rising use of disposable vaping devices. June 23, 2022. FDA says it won't complete review of e-cigarette products by Thursday Altria has few good options in Reduced Risk Products. But a footnote on page 9 of the new policy permits all flavors to continue to be sold in devices that cannot be refilled and are designed to be disposed of after the flavored nicotine has run dry. Schools and health officials across the U.S. are struggling to curb what they say is an epidemic of underage vaping. But it also prompted a fierce backlash from parents and regulators, who blamed the company for igniting a surge in teenage vaping. Juul says it is not targeting children and teens and that it supports efforts to limit tobacco products to people under age 21. Scan this QR code to download the app now. FDA Removes Millions Of E-Cigarette Products From The MarketBut Not In a speech on the Senate floor Thursday, Durbin praised the FDA decision. Altria's stock was down less than 1% in morning trading, while shares of British American Tobacco, which makes Juul rival Vuse, were down 1.7%. It just feeds the habit, he said. The FDA ban is not yet official and can be challenged in court, and in any case Juul was never that valuable to Altria. Why does e-cigarette maker Juul advertise its product on TV when cigarette ads are banned? A spokesman for Altria declined to comment. It is also a sponsor of the national We Card program, which trains retailers to avoid selling restricted products to minors. FDA has ordered more than 5 million e-cigarette products off the market, it said Thursday, in an announcement timed to a court-ordered deadline that will determine the future of the vaping industry. FDA bans Juul e-cigarettes as U.S. cracks down on nicotine products - CNBC In 2021, Juuls annual revenue was $1.3 billion, down from just under $1.5 billion in 2020 and $2 billion in 2019, according to a person familiar with the figures who spoke on the condition of anonymity because they were not authorized to provide them. In recent months, lawmakers in both parties have stepped up their criticism of the FDA for what they describe as the agencys unacceptably slow pace in banning flavored e-cigarettes made by Juul and other companies. Earlier this year, the FDA allowed some products made by Juul rival NJOY Inc. to remain on the market, and last year authorized British American Tobacco . FDA said e-cig makers could continue selling their products for one year while the agency reviewed their submissions. "We strongly support restrictions on social media marketing of vapor products.". In 2020, concerned about youth vaping, the FDA prohibited sales of sweet and fruity e-cigarette pods, which Juul had already stopped selling. Crazy how cheap it got in 12 days. feels like a big over reaction. Altria shares are now trading at an 8.9x P/E and an 8.7% Dividend Yield. For nearly 50 years, cigarette advertising has been banned from TV and . Altria 22Q2 Revenues Net of Excise -4.3%, Adj. demanding the agencys rationale for permitting disposables to stay on the market. Reporter, Commercial Determinants of Health. Large companies like Juul and Vuse . In June 2021, Juul agreed to pay $40 million over six years to settle a legal complaint by N.C. Attorney General Josh Stein. This is a reckless decision that will allow products proven to addict and endanger young people to continue being sold.. These disposable, completely self-contained e-cigarettes like Puff Bar and others share all of the characteristics that made Juul a problem.. The FDA said it will closely monitor Juul distributors and retailers to ensure the sales are halted.
