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NEW YORK, Dec. 31, 2013 /PRNewswire/ -- With massive brand awareness and personal usage steadily increasing, electronic cigarette companies are taking to the publicly traded exchanges to give their users and individual investors a chance to profit from this rising trend. For the non-believers who think e-cigs are a fad or predict they will be banned, a closer look at the participants in this space and their financials should paint a different picture.
Vapor Corp., founded in 2010 in Ft. Lauderdale, recently reported Q3 net sales of $6.4 million or approximately 66.3% or $2.6 million greater than net sales during Q3 of 2012. This was attributed to product variety, lower unit cost and higher volume purchases from suppliers. VPCO also received a $9 million cash-infusion from a private placement completed in October, supporting the company's plans for growth and expansion. The company has a market capitalization of $765 million and the stock recently conducted a 1-for-5 reverse split, now trading at $9.45 under the ticker VPCOD for the next 20 business days.
The other publicly traded company in the electronic cigarette arena is Victory Electronic Cigarettes Corp. trading at $9.05 with a market cap of $468 million and an impressive 52-week range of $0.56 to $60.00. However, it may be hard to enter or exit a position in ECIG with an average daily trading volume of approximately 1,000 shares. The company is headquartered in Michigan and initially began in 2010 as an online e-cig company, eventually expanding into retail in 2013. The company announced its acquisition of UK-based VAPESTICK for $70 million in cash and stock.
Clearette Electronic Cigarette Company, currently a privately held company in New York and one of the fastest growing in the e-cig market, is considering their options regarding going public. They have lifted their 2014 revenue projections from $48 million to $80 million, citing a "massively growing distribution network through the U.S. and abroad" and are positioned to become the number one selling e-cig by 2015.
Leading analysts are predicting that electronic cigarettes will garner 15% to over 50% share of the broader tobacco market over the next decade. With the current size of the market, this equates to an electronic cigarette industry valued between $110 and $360 billion. Major investment banks are now covering the e-cig space, with Citi expecting sales to hit $3 billion by 2015 and Wells Fargo expecting sales of $10 billion by 2017. Furthermore, Bloomberg Industries projects that electronic cigarette sales will exceed those of traditional cigarettes by 2047.
These projections have sparked the attention of existing publicly traded tobacco companies, with four out of the five major players already launching their own e-cig products. British American Tobacco launched Vype Electronic Cigarette in the U.K. and owns a 42% stake in Reynolds who launched Vuse E-Cigs in August. Altria launched MarkTen Electronic Cigarettes to test market in Indiana and Arizona and Phillip Morris announced plans on launching their line of electronic cigarettes in the second half of 2014 claiming it's "the single greatest opportunity for us".
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