Major global tobacco leaders have baffled the bears over the years as profits continue to rise despite increased government regulation, massive legal settlements and declining smoking rates worldwide. As the industry consolidates, industry giants have benefited from rising prices and successful cost cutting, seemingly pulling out of their dark period unscathed. (See also: Behind Tobacco Stocks’ Recent Strength.)

 Major Tobacco Firms by Enterprise Value | Statista

Analysts have applauded Big Tobacco’s diversification initiatives, ranging from smokeless tobacco, nicotine gum, caffeine powders and wine businesses. Yet as revenue from new products remain a sliver of overall sales, with tobacco giants still relying heavily on cigarettes, which have seen volumes plummet, many didn’t beat estimates as anticipated. As a result, shares have gone up in smoke.

Philip Morris International Inc.

Investors were hoping American global cigarette and tobacco leader Philip Morris International Inc. (PM) would continue to woo the Street on April 20 as plans for its ambitious plans for a cigarette-free future paid off. Yet trading at a price of $110.65 per share on Wednesday, shares have only rebounded slightly from a 3.4% dip on Q1 results.

The New York City-based maker of Marlboro cigarettes posted adjusted earnings of $0.98 per share, short of analysts’ estimates for $1.03. Revenue dipped 0.3% to $6.06 billion, failing to meet the consensus $6.47 billion estimate.

Philip Morris has invested $3 billion in research and development (R&D) for its iQOS heat-stick tobacco products. The company is awaiting possible FDA approval tht would allow it to market new products as “reduced-harm.”

Altria Group Inc.

Altria Group Inc. (MO) also failed to meet first-quarter earnings forecasts on May 2. Adjusted EPS of $0.73 per share fell short of expectations by a penny, while revenue of $4.59 billion also missed projections for $4.64 billion in sales. Instead of boosting sales by diversifying outside tobacco, Altria’s smokeless products and wine segments both posted worse performance, with sales down 2.5% and 3%, respectively.

Moving forward, the Richmond, Va.-based company doesn’t see recent set backs as changing growth expectations for the full year 2017.

Reynolds American Inc.

Winston-Salem, N.C.-based Reynolds American Inc. (RAI) reported Q1 results on May 3 in which adjusted EPS of $0.56 on revenue up 1.1% to $2.95 billion failed to meet analysts’ expectations for earnings of $0.58 on $3.03 billion in sales.

The company, which has invested heavily in alternative smoking products, estimates it will close its merger with British American Tobacco PLC (BTI) by the third quarter of 2017 after receiving U.S. and Japanese antitrust approvals. Trading down about 0.7% at a price of $64.43 on Wednesday, RAI reflects a 34.7% gain over the 12-month period.

British American Tobacco PLC

At its annual general meeting on April 26, U.K.-based BAT said that sales this year were in line with expectations for challenging conditions in a number of key markets after preliminary results in February exceeded expectations.

The firm plans to continue focusing on “next-gen products,” including its vapor brand Vype and heat-not-burn sticks, hoping to double the number of countries where it sells e-cigarettes and other vaping products for the next two years to reach 40 by 2018.

Last year, the company announced plans to buy Newport-brand maker Reynolds American, which together would command 80% of the U.S. cigarette market by volume and become the world’s largest listed tobacco company.

Imperial Brands Inc.

British-based global tobacco and cigarette company Imperial Brands Inc. (IMBBY) has seen its shares fall over 2% on Wednesday after reporting weaker-than-expected interim results. The U.K. firm forecasts stronger second-half earnings as it raised cost savings targets.

While tobacco revenue jumped 9.3% in the period, or 5.5% at constant currency, tobacco volume declines accelerated from 3.1% over the same period last year to 5.7% in the period ended March 31. Looking ahead, management hopes investment in alternative products such as pomegranate and chili-flavored caffeine powders will hedge against strict packaging laws at home and an overall consumer trend in the direction of healthy living. (See also: Imperial Brands Ditching Tobacco for Caffeine.)

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