Swedish Match stock rockets 32% in five days
It may not be politically correct these days, however there is clearly still a lot of money invested in the tobacco industry despite it being an ethical and health concern.
Despite this, there are still a lot of people who patronise tobacco products.
The days of motor racing events being dominated by racing cars painted in livery resembling a cigarette packet and public advertising billboards showing the public enticing images of glamour featuring nicotine products are long gone.
Alongside the complete absence in most countries around the world of any form of displays showing cigarettes, it is illegal to smoke in almost all public areas and workplaces across many parts of the world.
Despite these efforts to attempt to remove the temptation to start smoking cigarettes from non-smokers and to attempt to persuade current smokers to cease, there appears to be a lot of money still to be made in the tobacco product industry.
Today, Philip Morris International, an American multinational tobacco products manufacturer has agreed to buy Swedish Match, which is also a multinational tobacco products manufacturer, and is based in Stockholm, Sweden's capital city.
Swedish Match is publicly listed on the NASDAQ Stockholm exchange and was founded some 107 years ago.
Today, Philip Morris International agreed a deal worth $1.6 billion to buy Swedish Match, as its popular product 'Snus', which is a type of snuff which is not smoked by its consumers, along with more recently launched products such as Zyn which is a tobacco-free nicotine product have been revenue drivers in a world in which cigarette smoke is becoming less palatable among members of society and health consciousness is abound.
As a result of this deal having been agreed, Swedish Match shares rocketed to a record high, climbing 9% in just one day as the deal approached its final stages and then another climb this morning post-announcement.
Over the past five days, Swedish Match stock has risen some 32% and is now standing at 103.4 Swedish Krona, compared with 76 Swedish Krona per share yesterday morning.
This represents an unusual display of confidence in an industry which is considered legacy at best, and not ethically sound at worst, therefore can be considered to be a bout of volatility among NASDAQ contingents, which are often these days modern and highly technologically advanced rather than relics of times gone by.
Disclaimer: Neither the author of this article nor ETX Capital in any form endorses the smoking of tobacco products.