- Jefferies analysts said tobacco companies should perform well during a recession, even during the coronavirus outbreak.
- “If smokers are willing to take their chances with cancer and the various other serious health risks with cigarettes, we think they are likely to be little fazed by COVID,” the analysts wrote in a research note published Thursday.
- People may turn to cigarettes if they are struggling with boredom and depression during home quarantines, analysts said.
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Jefferies analysts called big tobacco “recession proof” this week and said they don’t expect people to stop smoking amid the coronavirus outbreak.
The analysts said they expect smokers to ignore warnings about COVID-19, the upper-respiratory disease caused by the coronavirus, because of their willingness to take chances with cancer.
“Smokers are well aware of the risks associated with tobacco products, yet continue smoking anyway,” the analysts wrote in research note published Thursday. “Even after large and disturbing graphic health warnings in the majority of markets worldwide, volumes have been little impacted. If smokers are willing to take their chances with cancer and the various other serious health risks with cigarettes, we think they are likely to be little fazed by COVID.”
In fact, the outbreak could encourage more smoking, as people confined to their homes struggle with boredom and depression, analysts wrote.
“It is generally accepted, and supported by studies, that boredom is a factor that influences smoking,” the analysts wrote. Stress, anxiety, and depression, “which many may also be experiencing in the