Tobacco stocks are popular dividend stocks for many investors

Tobacco stocks are some of the most popular sin stocks. Tobacco companies like Philip Morris (PM) and Lorillard (LO) are deemed defensive consumer staples in that they won’t be going anywhere any time soon.
However, legal action against tobacco companies regarding marketing has contributed to its slow decline since the 1980s. The U.S. Food and Drug Administration continuously threatens to bans menthol cigarettes, and tobacco stocks always falter as shareholders panic. Even though the FDA has not yet followed through on its efforts to squash menthol cigarettes, it is forcing tobacco companies to packaging their products without their logos branded on the cartons.

Still, tobacco continues to grow on the international stage, and overall sales, volume and dividends of tobacco stocks will likely continue on longer than any antagonistic legislation wants. So, investors can hold onto tobacco stocks for the high distributions but will want to be wary of when the FDA will really irreparably damage Big Tobacco.