Head to Head Survey: Japan Tobacco (OTCMKTS:JAPAF) versus Turning Point Brands (NYSE:TPB)

Turning Point Brands (NYSE:TPB) and Japan Tobacco (OTCMKTS:JAPAF) are both consumer staples companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, risk, valuation, institutional ownership, analyst recommendations and earnings.

Profitability

This table compares Turning Point Brands and Japan Tobacco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Turning Point Brands	12.02%	24.44%	9.96%
Japan Tobacco	N/A	N/A	N/A

Analyst Ratings

This is a summary of current recommendations and price targets for Turning Point Brands and Japan Tobacco, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Turning Point Brands	0	1	5	1	3.00
Japan Tobacco	0	0	0	0	0.00

Turning Point Brands currently has a consensus target price of $97.00, indicating a potential downside of 0.58%. Given Turning Point Brands’ stronger consensus rating and higher possible upside, analysts plainly believe Turning Point Brands is more favorable than Japan Tobacco.

Insider & Institutional Ownership

96.1% of Turning Point Brands shares are held by institutional investors. Comparatively, 24.7% of Japan Tobacco shares are held by institutional investors. 6.6% of Turning Point Brands shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Turning Point Brands pays an annual dividend of $0.30 per share and has a dividend yield of 0.3%. Japan Tobacco pays an annual dividend of $79.71 per share and has a dividend yield of 206.4%. Turning Point Brands pays out 10.6% of its earnings in the form of a dividend. Japan Tobacco pays out 35.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Turning Point Brands has increased its dividend for 7 consecutive years.

Earnings and Valuation

This table compares Turning Point Brands and Japan Tobacco”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Turning Point Brands	$360.66 million	5.16	$39.81 million	$2.84	34.35
Japan Tobacco	N/A	N/A	N/A	$225.55	0.17

Turning Point Brands has higher revenue and earnings than Japan Tobacco. Japan Tobacco is trading at a lower price-to-earnings ratio than Turning Point Brands, indicating that it is currently the more affordable of the two stocks.

Summary

Turning Point Brands beats Japan Tobacco on 13 of the 15 factors compared between the two stocks.

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 Creative Distribution Solutions. Zig-Zag Products segment markets and distributes rolling papers, tubes, finished cigars, make-your-own cigar wraps, and related products, as well as lighters and other accessories 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. Its Creative Distribution Solutions segment market and distribute other products without tobacco and/or nicotine to individual consumers through VaporFi B2C online platform, as well as non-traditional retail through VaporBeast. In addition, it markets and distributes cannabis accessories and tobacco products. The company sells its products to wholesale distributors and retail merchants in the independent and chain convenience stores, tobacco outlets, food stores, mass merchandising, drug store, and non-traditional retail channels. 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.

About Japan Tobacco

Japan Tobacco Inc., a tobacco company, manufactures and sells tobacco products, pharmaceuticals, and processed foods in Japan and internationally. The company operates through three segments: Tobacco Business, Pharmaceutical Business, and Processed Food Business. It offers tobacco products, such as cigarettes, heat-not-burn tobacco products, E-vapor products, fine cut tobacco products, cigars, pipes, smokeless tobacco products, and hookah and kretek products. The company provides reduced-risk products, including infused tobacco capsules and heated tobacco sticks. In addition, it researches and develops, manufactures, and sells prescription drugs for the therapeutic areas, such as cardiovascular, kidney and metabolism, immunity/inflammation, and central nervous system. Further, the company provides frozen and room-temperature products, such as frozen udon noodles, packed rice, and frozen okonomiyaki; bakery products; and seasonings, including yeast extracts, assembled, kelp and bonito extracts, and oyster sauces. It offers its products under the Winston, Camel, MEVIUS, and LD brands. Japan Tobacco Inc. was incorporated in 1985 and is headquartered in Tokyo, Japan.