Turning Point Brands Stock: What Soaring 97% Gains Mean for Its True Value in 2025

If you’re wondering what to do with Turning Point Brands stock right now, you’re in good company. The last year has seen a wild ride in the share price, soaring 97.4% over the past twelve months and an impressive 280.9% over the past three years. Even with a short-term dip of 4.2% in the last week and a 14.2% slide over the past month, Turning Point Brands has easily outpaced the broader market for a good stretch. These fluctuations are catching the attention of both seasoned investors and newer market watchers, especially as discussions grow around shifts in regulatory stances and evolving market sentiment in the tobacco and alternative products sector.

What is behind these dramatic moves? Aside from general sentiment shifts in the industry, recent news has spotlighted Turning Point Brands’ strategic reinvestment in its core brands and a few promising product launches. This has not only influenced growth expectations but also how people are sizing up the company’s risk profile. Whether these developments truly unlock value or simply fuel short-term volatility is a question many are eager to answer.

Right now, Turning Point Brands lands a valuation score of 2 out of 6. That means it is considered undervalued in just two of the six major valuation metrics. For investors on the fence, that number might spark some caution, but it also raises an interesting debate: is the stock fairly priced after its rapid climb, or does the market still underestimate its long-term potential? In the next sections, we will break down how different valuation approaches stack up before considering if there is an even better way to think about what Turning Point Brands is truly worth.

Turning Point Brands scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Turning Point Brands Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow (DCF) model works by projecting a company's future cash flows and then discounting those amounts back to their value today. This gives investors a sense of the company’s intrinsic worth based on anticipated performance rather than current market mood.

For Turning Point Brands, the DCF method looks at the company’s recent Free Cash Flow, which stands at $53.5 million, and extrapolates growth over the coming years. Analysts expect Free Cash Flow to grow steadily, reaching approximately $70.3 million by 2026. Beyond five years, additional estimates, extrapolated rather than analyst-driven, show FCF still climbing, though at a slower pace, up to about $86.3 million by 2035.

Running these numbers through the DCF model, the resulting intrinsic value for the stock lands at $79.41 per share. Compared to its current market price, the model suggests Turning Point Brands is trading at a 10.4% premium, meaning it is considered slightly overvalued according to this cash-flow-centered approach.

Result: OVERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Turning Point Brands.

Our Discounted Cash Flow (DCF) analysis suggests Turning Point Brands may be overvalued by 10.4%. Find undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Turning Point Brands Price vs Earnings

For companies like Turning Point Brands that report consistent profits, the Price-to-Earnings (PE) ratio is one of the most popular and useful ways to gauge valuation. This metric helps investors quickly see how much they are paying for each dollar of earnings, which is especially telling for profitable businesses.

The right PE ratio is not just about a single number, as it is shaped by how fast the company is expected to grow, the stability of its earnings, and the overall level of risk. Fast-growing, high-margin or less risky companies often command a higher PE, while slower or riskier businesses trade at lower multiples.

Turning Point Brands trades at a PE of 30.9x. For context, the tobacco industry average PE is only 14.1x and the average PE among its peer group sits at 37.2x. While Turning Point’s PE is well above the broader industry, it is lower than many peers following similar strategies.

Simply Wall St’s proprietary "Fair Ratio" is designed to cut through the noise by estimating the multiple that truly fits a company’s growth prospects, risk profile, profit margins, and market size. Unlike basic peer or industry comparisons, this measure adapts to characteristics that matter most to shareholders.

In this case, Turning Point’s Fair Ratio is 27.6x, just slightly below the actual PE of 30.9x. That small gap suggests the stock is valued about right based on earnings power and its specific mix of risks and opportunities.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Turning Point Brands Narrative

Earlier we mentioned a better way to understand valuation, so let’s introduce you to Narratives. Think of a Narrative as your own story about Turning Point Brands that connects what you believe about the company’s future, such as its sales, profits, and outlook, to a fair value for the stock. Narratives aren’t just numbers; they are a transparent and dynamic way to express your perspective and see how it compares to other investors.

On Simply Wall St’s Community page, millions of investors are already using Narratives to make smarter decisions. You build a Narrative by laying out your assumptions, such as how quickly revenue grows, where margins go next, and what risks matter most, and then see how those beliefs translate to a fair value. Narratives don’t just stop there. As new information comes in, your Narrative updates automatically, helping you track whether a stock is overpriced or still offers upside every time you look at the market.

For Turning Point Brands, one Narrative might expect rapid expansion in modern oral and hemp, supporting a fair value of $107.75. A more cautious Narrative might flag regulatory and consumer risks, yielding a much lower estimate near $65. Sometimes, the gap between stories is the key to your best investment moves.

Do you think there's more to the story for Turning Point Brands? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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