Tobacco giant Altria Group (NYSE:MO) is the parent company of Phillip Morris (NYSE:PM) along with other popular cigarette brands.
At the Barclays Global Consumer Staples Conference in Boston on Wednesday, company executives said that it is “exploring options” within the cannabis industry.
Will Altria Group Invest in Cannabis?
Such is the trend at the moment. Interest from mainstream consumer companies in the marijuana industry is at an all-time high, following several high-profile investments.
In recent weeks, major alcohol-industry giants have invested in cannabis; the biggest so far being Constellation Brands (NYSE:STZ) $4 billion USD stake in Canopy Growth Corp (TSE:WEED) (OTCPK:TWMJF).
Potential For the Future
At the conference, Murray Garnick, an executive of Altria Group, said that the company was keeping its eye on the legality of marijuana:
“As you know, cannabis remains illegal under federal law, and we intend to continue to comply with federal law. Having said that, we are exploring our options, and we’re mindful of the possibility that in the future cannabis may no longer be illegal under federal law.”
He further mentioned that the company is "exploring our position, studying and evaluating market opportunities." and was evaluating its competitive advantage relative to alcohol companies.
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Health is Not Wealth, for Tobacco Industry
In recent years, the tobacco industry has experienced stock depletions across the board. Heavy taxes and duties, along with advertising restrictions have hit companies hard. It makes sense for this industry to evolve towards cannabis and its relative products.
Altria, specifically, is seeing its stock prices down 18%.
The company has been coyly threading near cannabis for years. Philip Morris brand invested $20 million into Syqe Medical — an Israel-based company that creates 3D-printed cannabis inhalers. Also, the same company's European subsidiary received a patent for plants “producing terpenes of interest… including…. Cannabis sativa.”.
Watch this space. Altria Group may be a dark-horse yet.
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