Yahoo Finance Mario Gabelli Comments on Swedish Match
- By Holly LaFon
Swedish Match AB (OSTO:SWMA) (3.7%)(SWMA - $35.22/SEK296.70 -Stockholm Stock Exchange) produces tobacco products that include snus and snuff, chewing tobacco, cigars, and lights. The company has been benefiting from the growth of the smokeless tobacco market in both Scandinavia and the U.S., as public smoking bans and health concerns are driving consumers to seek alternative tobacco products to cigarettes. In October 2010, Swedish Match combined its European and premium cigar portfolios with Scandinavian cigar and pipe tobacco company STG, creating a new company that should benefit from enhanced scale and synergies. In February 2016, STG went public via an IPO on the Copenhagen Stock Exchange, with Swedish Match partially monetizing its stake. In January, Swedish Match further sold down its holdings in STG to 9% of the company, and we expect further sales in coming years. As a more focused company, we expect Swedish Match to grow sales and earnings over time, as the smokeless tobacco category continues to develop. We also believe the company could be an attractive takeover candidate for a global tobacco company that wants to increase its presence in the smokeless segment.
Warning! GuruFocus has detected 3 Warning Sign with OSTO:SWMA. Click here to check it out.
The intrinsic value of OSTO:SWMA
From Mario Gabelli (Trades, Portfolio)'s second-quarter Gabelli Value 25 Fund shareholder commentary.
This article first appeared on GuruFocus.
Warning! GuruFocus has detected 3 Warning Sign with OSTO:SWMA. Click here to check it out.
The intrinsic value of OSTO:SWMA
