NYSE:TPB

Stock Analysis Report

Executive Summary

Turning Point Brands, Inc., together with its subsidiaries, provides other tobacco products in the United States.


Snowflake Analysis

Good value with reasonable growth potential.


Similar Companies

Share Price & News

How has Turning Point Brands's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: TPB has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

11.5%

TPB

1.6%

US Tobacco

-1.1%

US Market


1 Year Return

-40.9%

TPB

-11.4%

US Tobacco

17.9%

US Market

Return vs Industry: TPB underperformed the US Tobacco industry which returned -11.4% over the past year.

Return vs Market: TPB underperformed the US Market which returned 18% over the past year.


Shareholder returns

TPBIndustryMarket
7 Day11.5%1.6%-1.1%
30 Day-5.9%-8.6%1.4%
90 Day-9.6%-6.8%6.9%
1 Year-40.5%-40.9%-5.5%-11.4%20.3%17.9%
3 Year86.8%84.3%-27.7%-37.9%47.8%38.3%
5 Yearn/a3.0%-18.2%71.9%53.0%

Price Volatility Vs. Market

How volatile is Turning Point Brands's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Turning Point Brands undervalued compared to its fair value and its price relative to the market?

33.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TPB ($24.25) is trading below our estimate of fair value ($36.6)

Significantly Below Fair Value: TPB is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: TPB is poor value based on its PE Ratio (15.3x) compared to the Tobacco industry average (14.4x).

PE vs Market: TPB is good value based on its PE Ratio (15.3x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: TPB is good value based on its PEG Ratio (0.7x)


Price to Book Ratio

PB vs Industry: TPB is overvalued based on its PB Ratio (5x) compared to the US Tobacco industry average (3.5x).


Next Steps

Future Growth

How is Turning Point Brands forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

21.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TPB's forecast earnings growth (21% per year) is above the savings rate (1.7%).

Earnings vs Market: TPB's earnings (21% per year) are forecast to grow faster than the US market (14.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: TPB's revenue is expected to decline over the next 3 years (-4.1% per year).

High Growth Revenue: TPB's revenue is forecast to decline over the next 3 years (-4.1% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TPB's Return on Equity is forecast to be high in 3 years time (31.6%)


Next Steps

Past Performance

How has Turning Point Brands performed over the past 5 years?

40.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TPB has a large one-off loss of $11.5M impacting its September 30 2019 financial results.

Growing Profit Margin: TPB's current net profit margins (8.2%) are higher than last year (7.6%).


Past Earnings Growth Analysis

Earnings Trend: TPB has become profitable over the past 5 years, growing earnings by 40.1% per year.

Accelerating Growth: TPB's earnings growth over the past year (30.2%) is below its 5-year average (40.1% per year).

Earnings vs Industry: TPB earnings growth over the past year (30.2%) exceeded the Tobacco industry 2.3%.


Return on Equity

High ROE: Whilst TPB's Return on Equity (32.54%) is high, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Turning Point Brands's financial position?


Financial Position Analysis

Short Term Liabilities: TPB's short term assets ($202.6M) exceed its short term liabilities ($43.3M).

Long Term Liabilities: TPB's short term assets ($202.6M) do not cover its long term liabilities ($315.7M).


Debt to Equity History and Analysis

Debt Level: TPB's debt to equity ratio (332.3%) is considered high.

Reducing Debt: TPB had negative shareholder equity 5 years ago, but is now positive and has therefore improved.

Debt Coverage: TPB's debt is not well covered by operating cash flow (10.1%).

Interest Coverage: TPB's interest payments on its debt are well covered by EBIT (4.5x coverage).


Balance Sheet

Inventory Level: TPB has a high level of physical assets or inventory.

Debt Coverage by Assets: TPB's debt is not covered by short term assets (assets are 0.6x debt).


Next Steps

Dividend

What is Turning Point Brands's current dividend yield, its reliability and sustainability?

0.74%

Current Dividend Yield


Dividend Yield vs Market

company0.7%marketbottom25%1.4%markettop25%3.7%industryaverage6.3%forecastin3Years0.8%

Current dividend yield vs market & industry

Notable Dividend: TPB's dividend (0.74%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: TPB's dividend (0.74%) is low compared to the top 25% of dividend payers in the US market (3.73%).


Stability and Growth of Payments

Stable Dividend: TPB is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: TPB is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: TPB is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of TPB's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.9yrs

Average management tenure


CEO

Larry Wexler (67yo)

10.7yrs

Tenure

US$2,200,614

Compensation

Mr. Lawrence S. Wexler, also known as Larry, has been the Chief Executive Officer and President of North Atlantic Trading Co Inc. since April 16, 2007. Mr. Wexler has been the Chief Executive Officer and P ...


CEO Compensation Analysis

Compensation vs Market: Larry's total compensation ($USD2.20M) is above average for companies of similar size in the US market ($USD1.67M).

Compensation vs Earnings: Larry's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Lawrence Wexler
President10.7yrsUS$2.20m1.79% $8.5m
Robert Lavan
CFO & Senior VP1.9yrsUS$971.84k0.031% $145.5k
James Dobbins
Senior VP20.7yrsUS$839.07k0.43% $2.0m
Graham Purdy
Chief Operating Officer0.3yrsno data0.48% $2.3m
Brian Wigginton
Chief Accounting Officer & VP of Finance1.9yrsno datano data
Michael Terry
Senior Vice President of Marketing0yrsno datano data
James Murray
Senior Vice President of Business Planning15.1yrsUS$235.93k0.17% $801.4k
Charles Melander
Senior Vice President of Operations & Quality Assurance0yrsno datano data
Brittani Cushman
Senior Vice President of External Affairs1.4yrsno datano data

1.9yrs

Average Tenure

58.5yo

Average Age

Experienced Management: TPB's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Lawrence Wexler
President10.7yrsUS$2.20m1.79% $8.5m
Gregory H. Baxter
Independent Director13.8yrsUS$65.00k0.012% $55.6k
Peggy Hwan Hebard
Independent Director1.4yrsUS$18.75k0.015% $72.8k
H. C. Diao
Independent Director7.3yrsUS$97.50k0.086% $412.2k
David Glazek
Chairman & Lead Independent Director0.4yrsno datano data
Arnold Zimmerman
Independent Director7.1yrsUS$75.00k0.32% $1.5m
Ashley Frushone
Independent Director1.4yrsUS$16.25k0.0013% $6.4k

7.1yrs

Average Tenure

62yo

Average Age

Experienced Board: TPB's board of directors are considered experienced (7.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Turning Point Brands, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Turning Point Brands, Inc.
  • Ticker: TPB
  • Exchange: NYSE
  • Founded: 2004
  • Industry: Tobacco
  • Sector: Food, Beverage & Tobacco
  • Market Cap: US$476.806m
  • Shares outstanding: 19.66m
  • Website: https://www.turningpointbrands.com

Number of Employees


Location

  • Turning Point Brands, Inc.
  • 5201 Interchange Way
  • Louisville
  • Kentucky
  • 40229
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TPBNYSE (New York Stock Exchange)YesVoting Common StockUSUSDMay 2016
0T5DB (Deutsche Boerse AG)YesVoting Common StockDEEURMay 2016

Biography

Turning Point Brands, Inc., together with its subsidiaries, provides other tobacco products in the United States. The company operates in three segments: Smokeless Products, Smoking Products, and NewGen Products. The Smokeless Products segment manufactures and markets moist snuff; and contracts for and markets loose leaf chewing tobacco products. The Smoking Products segment imports and markets cigarette papers, tubes, and related products, as well as finished cigars, make-your-own cigar tobaccos, and cigar wraps; and processes, packages, and markets pipe tobaccos. The NewGen Products segment markets and distributes e-cigarettes, e-liquids, vaporizers, and other products without tobacco and/or nicotine. It also distributes various assortments of vaping related products to non-traditional retail outlets through VaporBeast, Vapor Shark, Vapor Supply, and IVG; and various vaping related products to individual consumers through Shark, Vapor World, and VaporFi branded retail outlets, as well as through online platforms. The company sells its products under the Zig-Zag, Beech-Nut, Stoker’s, Trophy, VaporBeast, Vapor Shark, VaporFi, Havana Blossom, Durango, Tequila Sunrise, Fred’s Choice, Old Hillside, Our Pride, Red Cap, Tennessee Chew, Big Mountain, Springfield Standard, Snake River, DirectVapor, and SouthBeachSmoke brands. It sells its products to wholesale distributors and retail merchants in the independent and chain convenience store, tobacco outlet, food store, mass merchandising, drug store, and non-traditional retail channels. The company was formerly known as North Atlantic Holding Company, Inc. and changed its name to Turning Point Brands, Inc. in November 2015. Turning Point Brands, Inc. was incorporated in 2004 and is headquartered in Louisville, Kentucky. Turning Point Brands, Inc. is a subsidiary of Standard Diversified Inc. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/23 02:30
End of Day Share Price2020/02/21 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.