Turning Point Brands, Inc. (TPB): A Bull Case Theory

We came across a bullish thesis on Turning Point Brands, Inc. on Emil Hartela Investing’s Substack by Emil. In this article, we will summarize the bulls’ thesis on TPB. Turning Point Brands, Inc.'s share was trading at $98.02 as of September 25th. TPB’s trailing and forward P/E were 35.01 and 24.75 respectively according to Yahoo Finance.

TPB Holdings (TPB) occupies a unique position in the U.S. nicotine pouch market, with its products FRE and ALP already on the shelves, giving it a head start over competitors still awaiting approvals. Nicotine pouches currently account for roughly 20–30% of TPB’s revenue, though reported figures overstate TPB’s share due to the 50/50 joint venture with Tucker Carlson on ALP. Adjusting for this, the company’s exposure is smaller, but the key takeaway is that TPB operates effectively as two distinct businesses, with a significant portion of profits flowing to Carlson rather than shareholders.

TPB’s growth is fueled not just by first-mover advantage but also by ALP’s strong branding through Carlson’s large following, which appeals to consumers seeking an alternative to competitors like ZYN. The products themselves are well-received, offering high strength at competitive prices, creating a value proposition that resonates with users and positions TPB to capture more of a market likely to expand dramatically over the next decade, potentially reaching $100 billion. If TPB achieves even a 10% market share, its valuation could reach $10–20 billion, though conservative models suggest $4–5 billion, still implying substantial upside.

Short-term growth is prioritized over margins, as the early-stage market rewards consumer switching and expansion. Challenges remain, including lean production—much of it in India—and opaque reporting around joint venture economics, which complicates assessment of shareholder value. Nevertheless, TPB’s established products, distribution network, and favorable market dynamics suggest strong near-term growth, with the potential for long-term value capture as the U.S. nicotine pouch market matures.

Previously we covered a bullish thesis on British American Tobacco p.l.c. (BTI) by Brian Coughlin in April 2025, which highlighted strong growth of nicotine pouches via the Velo brand, product innovation, and competitive pricing versus Zyn. The company's stock price has appreciated approximately by 25.14% since our coverage. The thesis still stands as the category expands. Emil Hartela shares a similar perspective but emphasizes TPB’s U.S. first-mover advantage, Carlson-backed branding, and market growth potential.

Turning Point Brands, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 35 hedge fund portfolios held TPB at the end of the second quarter which was 38 in the previous quarter. While we acknowledge the potential of TPB as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.