Shares of tobacco maker
) hit a new 52-week high of $62.25 on Jun 19, 2014, recording a
healthy year-to-date return of 26.2%.
RAI shares gained momentum after it announced on Jun 18 that it
will launch its successful e-cigarette brand Vuse nationwide,
beginning Jun 23. (Read:
Reynolds' Vuse Expanding Nationwide from Jun 23
Vuse received favorable response since its launch in 500 stores
in Colorado in July last year and also gained major market share in
Utah where it was launched earlier this year. Reynolds launched the
brand in two varieties - Vuse Solo and Vuse System.
Vuse is a "digital" cigarette as it is fitted with a proprietary
computer chip modulating its performance. The chip delivers
consistent flavor giving it an edge over other e-cigarettes.
The Vuse Solo includes a flavor cartridge, which comes in two
flavors - original and menthol - a rechargeable Vuse power unit and
a USB charger. Moreover, the depleted cartridges and power units
can be returned to Reynolds Vapor Company through a prepaid mailer
available at the online shopping site of the brand.
In order to facilitate smooth distribution, Reynolds' two
subsidiaries - R.J. Reynolds Tobacco Company and R.J. Reynolds
Vapor Company - entered into a service agreement last month to gear
up the production of e-cigarettes within the next four years.
To support the increased supply, Reynolds, which currently
carries a Zacks Rank #3 (Hold) has announced the expansion of its
manufacturing facility in Tobaccoville, NC. In addition, the
cigarette maker is planning to install high speed, next generation
e-cigarette manufacturing equipment at the facility. (Read:
Reynolds Boosts e-Cigarette Investment
Two tobacco stocks that also reached a 52 week high on the same
day as Reynolds were
Altria Group Inc.
). Both Altria and Lorillard are also putting great focus on the
e-cigarette category. Moreover, n an attempt to boost its
unconventional cigarettes, Altria entered into a strategic
Philip Morris International Inc.
). Under the agreement, Philip Morris will market Altria's MarkTen
e-cigarettes internationally and the latter will distribute two of
Philip Morris' heated tobacco products in the U.S.
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