E cigs: What You Need to Know


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E cigs: What You Need to Know

  1. 1. E-Cigs: What You Need to Know
  2. 2. The Electronic Cigarette Industry • Smoking contributes to 80% of lung-cancer deaths in women; 90% in men, according to the American Lung Association • E-cigs have 450 times lower levels of toxicants in their vapors than can be found in cigarette smoke • At just $1.2 billion, the e-cig market is still small • Only 1% of the $89 billion tobacco industry
  3. 3. The Electronic Cigarette Industry • E-cigarettes, which do not contain tobacco, resemble traditional cigarettes but use a battery to heat a liquid nicotine solution, which creates a vapor – not smoke -- that users inhale. • There is no second-hand smoke with e-cigs • Gives users their nicotine fix without the toxins and carcinogens generated by burning tobacco.
  4. 4. The Electronic Cigarette Industry • Between manufacturer price hikes on cigarettes, increased taxes by local, state, and federal governments, and bans on public smoking, cigarette sales will continue to fall • There is no federal excise tax on e-cigarettes • Sales are estimated to hit between $3 billion and $10 billion over next 5 years • Could surpass regular cigarette sales within the next decade
  5. 5. The Top 5 E-Cig Brands E-Cig Brand Market Share by Units Market Share by Dollar blu eCig 36.1% 44.8% Njoy 17.7% 20.6% Logic 20.8% 18.5% 21st Century 7.3% 4.2% Nicotek 4.6% 3.0%
  6. 6. E-Cig Industry Wildcards • Lorillard was first Big Tobacco company to embrace e-cigs with purchase of blue eCig for $135 million • Just acquired SkyCig for $49 million • Reynolds American recently introduced its Vuse brand in Colorado and captured 80% of the market • Altria to introduce NuMark MarkTen brand • Will partner with Philip Morris International to market e-cigs and smokeless tobacco products globally
  7. 7. E-Cig Industry Risks • Benefits are still largely unknown by regulators and politicians • Because they look like cigarettes there is fear they will lead to complacency over smoking • Fear that flavors and aromas will attract kids • "Vaping" bans are being enacted in a number of cities • Largely unregulated, the FDA is angling to regulate the market, similar to tobacco
  8. 8. Nicotek Metro E-Cig Brand • Disposable or rechargeable • Standard kit comes with USB charger, 2 cartridges, 1 rechargeable battery, carrying case • Comes in 3 different flavors: 1.2% nicotine by volume, 1.8%, and 1.8% menthol
  9. 9. 21st Century 21st Century Smoke E-Cig Brand • • • • Disposable or rechargeable Disposable device is comparable to 1 pack of cigarettes Rechargeable cartridge is comparable to approximately 2 packs of cigarettes Comes in different flavors, from 1.6% nicotine per ml to 2.0% per ml, and menthol
  10. 10. Logic Logic E-Cig Brand • • • • Rechargeable Cartridge is comparable to 400 puffs or approximately 2 packs of cigarettes Comes in different flavors, from 1.4% nicotine per volume to 2.4% per ml, and menthol Also available in 0% nicotine by volume and a 0.8% hookah strength
  11. 11. NJOY NJOY E-Cig Brand • Disposable or rechargeable • No lighting or charging required • Comes in different flavors, from 0.6% nicotine per volume to 1.8% per ml, and menthol
  12. 12. Lorillard blu eCig Brand • Rechargeable or disposable • Cartridge is comparable to 250; premium cartridges equate to 350 puffs • Comes in different flavors ranging in 0 mg of nicotine to 13-16 mg
  13. 13. The Motley Fool’s Top Stock for 2014