Slashing smoking rates in half
“Reducing nicotine in cigarettes to nonaddictive or minimally addictive levels, in our view, would be a potential game changer for the U.S. industry,” the analysts wrote. Morgan Stanley kept its tobacco stock recommendations low, essentially recommending investors sell.
In recent months, Bonnie Herzog, managing director of consumer equity research for Wells Fargo Securities, New York, has been suggesting a brighter future for tobacco companies, saying that while cigarette consumption has been on a slow decline, price elasticity and portfolio diversification has been helping tobacco companies prepare for the future.