Why Turning Point Brands Stock Is Plummeting Today

By Josh Kohn-Lindquist – Mar 2, 2026 at 12:01PM ESTKey PointsTurning Point grew sales by 29% in the fourth quarter, while adjusted earnings per share slid 3% lower.However, its nicotine pouch sales grew by 266% as the company expanded its distribution footprint.Shares of white nicotine pouch and smoking accessories maker and marketer Turning Point Brands (TPB 17.32%) are down 20% as of 11 a.m. ET this morning after the company released fourth-quarter earnings. During the quarter, Turning Point grew sales by 29% while adjusted earnings per share dipped 3%, with both figures outpacing Wall Street's consensus. However, management guided for adjusted EBITDA to decline 15% sequentially as the company continues its shift away from legacy smoking accessories and Zig-Zags to white nicotine pouches, and the market is taking a wait-and-see stance today. Ultimately, I don't believe today's sell-off is anything to worry about. Instead, it appears to be the product of a stock that was priced for perfection, after it rose 500% over the last three years before today's drop. ExpandNYSE: TPBTurning Point BrandsToday's Change(-17.32%) $-23.72Current Price$113.27Key Data PointsMarket Cap$2.6BDay's Range$105.03 - $117.1352wk Range$51.48 - $146.90Volume36KAvg Vol315KGross Margin57.17%Dividend Yield0.22% Initially known for its Zig-Zag smoking accessories and rolling papers, and its Stoker's smokeless tobacco, Turning Point is transitioning to a future powered by white nicotine pouch sales from its ALP and FRE brands. These nicotine pouch sales soared 266% in Q4, accounting for 34% of total sales, up from 12% last year. Looking ahead to 2026, management expects FRE and ALP to account for roughly half of the company's total revenue, potentially becoming the cornerstones of Turning Points' brands. However, this shift doesn't come without costs. The company saw SG&A expenses rise 38% in Q4 -- slightly outpacing revenue growth and causing profitability to decline -- as costs for marketing, compliance, outbound freight, and new production capabilities increased. Image source: Getty Images. That said, these all seem like necessary investments, as Turning Point Brands reinvents itself and quickly pivots from areas of slow (or no) growth to a nicotine pouch industry projected to grow by at least 20% over the next five years or more. Now trading at 27 times forward earnings, Turning Point's days as a traditional value stock are long gone. However, it's booming FRE and ALP brands could easily help it live up to this slightly lofty valuation as Turning Point adds the products to more convenience stores and brick-and-mortar locations across the U.S.Read NextJul 27, 2022 •By Travis HoiumWhy Turning Point Brands Stock Plunged 19.6% TodayOct 26, 2021 •By Rich DupreyWhy Cigarette Alternative Turning Point Brands Is Tumbling TodayNov 2, 2020 •By Luis Sanchez CFAWhy Turning Point Brands Is a Tobacco Stock to WatchOct 20, 2020 •By Luis Sanchez CFAWhy This Tobacco Company Is Booming in 2020Jun 17, 2020 •By Luis Sanchez CFAThis Alternative Tobacco Company Is Seeing Increased DemandApr 28, 2020 •By Motley Fool TranscribersTurning Point Brands, Inc. (TPB) Q1 2020 Earnings Call TranscriptAbout the AuthorJosh Kohn-Lindquist is a contributing Motley Fool stock market analyst covering consumer goods, industrials, and technology stocks. Previously, Josh was a senior mutual fund accountant at Gemini Fund Services. He holds a bachelor’s degree in business management from the University of South Dakota.TMFJorykoX@JorykoliStocks MentionedTurning Point BrandsNYSE: TPB$113.90(-16.86%)-$23.09*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.