About Turning Point Brands
Turning Point Brands, Inc., together with its subsidiaries, manufactures, markets, and distributes branded consumer products. The company operates through three segments: Zig-Zag Products, Stoker's Products, and NewGen Products. The Zig-Zag Products segment markets and distributes rolling papers, tubes, finished cigars, make-your-own cigar wraps, and related products under the Zig-Zag brand. The Stoker's Products segment manufactures and markets moist snuff tobacco and loose-leaf chewing tobacco products under the Stoker's, Beech-Nut, Durango, Trophy, and Wind River brands. The NewGen Products segment markets and distributes cannabidiol isolate, liquid vapor products, and other products without tobacco and/or nicotine to individual consumers through VaporFi B2C online platform, as well as non-traditional retail through VaporBeast. It sells its products to wholesale distributors and retail merchants in the independent and chain convenience stores, tobacco outlets, food stores, mass merchandising, and drug stores.
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 founded in 1988 and is headquartered in Louisville, Kentucky.
TPB operates in the Manufacturing | Tobacco Products | headquartered in LOUISVILLE, Kentucky | approximately 430 employees | led by CEO Graham A. Purdy.
The $1.8B question: What happens when a company this good becomes this expensive?
In the constellation of American capitalism, certain companies shine brighter than others — not because they are inherently more valuable, but because they have positioned themselves at the nexus of forces that shape the economy. Turning Point Brands, Inc. is one such company.
At $1.8B in market capitalization, Turning Point Brands, Inc. (TPB) currently ranks #139 in our quantitative model, with a composite score of 77.5/100. That places it firmly in "Strong Buy" territory — our highest conviction rating.
But here's the thing about stocks priced for perfection: They leave no room for error.
The Numbers That Matter
Let's start with what's undeniably true. Our 6-factor model gives TPB the following scores:
| Factor | Score | Weight | Assessment |
|---|---|---|---|
| Quality | 88/100 | 30% | Exceptional |
| Value | 76/100 | 15% | Fair |
| Momentum | 88/100 | 25% | Accelerating |
| Investment | 32/100 | 10% | Low |
| Stability | 35/100 | 10% | Volatile |
| Short Interest | 57/100 | 10% | Normal |
The quality score of 88/100 is the headline here. It reflects profitability metrics that would make most CFOs weep with envy:
- ROE: 28.6%
- Net Margin: 20.0%
- Gross Margin: 59.2%
These aren't just good numbers. They're the kind of numbers that make TPB a "must-own" stock for institutional portfolios.
The Bull Case
"If you could design a business in a laboratory, it would look something like TPB."
The bull case writes itself:
- Quality is persistent. Academic research shows high-quality stocks outperform by 4-6% annually over long periods. TPB is quality defined.
- Momentum is real. With a momentum score of 88/100, the stock has been recognized by the market — and momentum tends to persist.
- The moat is deep. Companies with these margins don't lose them easily. The competitive position is entrenched.
The Bear Case
But here's what keeps value investors up at night:
- Valuation compression risk. At current levels, the stock is priced for continued perfection. Any stumble — a missed quarter, a competitive threat, a macro slowdown — could compress the multiple from 34.0x to the low 20s. That's a 20-30% decline without anything fundamentally "wrong."
- The crowded trade problem. When everyone owns a stock, who's left to buy? Momentum works until it doesn't.
- Mean reversion. Trees don't grow to the sky. At some point, growth decelerates.
The Valuation Framework
| Scenario | Assumption | Fair Value | Upside/Downside |
|---|---|---|---|
| Bear | Multiple compression to 20x | -20% | Downside |
| Base | Current trajectory continues | +10-15% | Modest upside |
| Bull | Momentum accelerates | +30-40% | Significant upside |
The risk-reward is ... fine. Not exceptional. Not terrible. Just fine.
The Bottom Line
Turning Point Brands, Inc. is exactly what it appears to be: a high-quality business with strong momentum trading at a premium price. Whether that's attractive depends entirely on what kind of investor you are.
For long-term, buy-and-hold investors, TPB is a core holding. For value investors or short-term traders, look elsewhere.
The company is priced for perfection — and in markets, as in life, perfection is a fragile thing.
⭐⭐⭐⭐⭐ Rating: 5-Star Strong Buy
Score: 77.5/100 | Rank: #139 of 3,571 stocks
Sector: Consumer Staples
This analysis reflects the views of Blank Capital Research as of February 16, 2026. It is not investment advice. Past performance does not guarantee future results.