Why This Fund Trimmed $4 Million of Turning Point Brands Despite Surging Oral Nicotine Sales

Crown Advisors Management, Inc. reduced its stake in Turning Point Brands (NYSE:TPB) by 35,000 shares in the first quarter, an estimated $3.90 million trade based on quarterly average pricing, according to its May 7, 2026, SEC filing.

What happened

According to a filing with the Securities and Exchange Commission dated May 7, 2026, Crown Advisors Management, Inc. sold 35,000 shares of Turning Point Brands in the first quarter. The transaction's estimated value was $3.90 million, based on the average closing price for the quarter. The holding's value at quarter-end fell by $4.12 million, a figure that includes both the share sale and underlying price changes.

What else to know

• This reduction leaves TPB at 0.86% of the fund's 13F assets as of March 31, 2026.
• Top holdings after the filing:
  • NYSE:FIX: $17.93 million (11.9% of AUM)
  • NASDAQ:LRCX: $10.68 million (7.1% of AUM)
  • NASDAQ:NVDA: $10.46 million (6.9% of AUM)
  • NASDAQ:STRL: $8.14 million (5.4% of AUM)
  • NASDAQ:LOPE: $7.65 million (5.1% of AUM)
• As of May 7, 2026, TPB shares were priced at $90.22, up 22% from one year earlier, compared to a 30% gain for the S&P 500 in the same period.

Company overview

Company snapshot

• Turning Point Brands, Inc. offers branded consumer products, including rolling papers, cigars, moist snuff, chewing tobacco, and vapor products under brands such as Zig-Zag and Stoker's.
• The company generates revenue through manufacturing, marketing, and distributing tobacco and alternative products across three segments: Zig-Zag Products, Stoker's Products, and NewGen Products.
• Primary customers include wholesale distributors, retail merchants, and convenience stores, as well as individual consumers via online platforms.

Turning Point Brands, Inc. is a diversified consumer products company with a focus on tobacco and next-generation alternatives. The company leverages established brands and a broad distribution network to maintain strong market positions in both traditional and emerging product categories. Its multi-segment strategy enables it to address evolving consumer preferences and regulatory environments in the tobacco and alternative products industry.

What this transaction means for investors

Turning Point Brands’ stock has underperformed the S&P but not by too much, and the firm’s latest quarter showed why investors have stayed interested. Modern Oral net sales surged 133% year over year to $52 million and now account for 42% of total company sales, up from just 21% a year ago. Total revenue climbed 16.8% to $124.3 million, prompting management to raise full-year Modern Oral sales guidance to as high as $225 million from a recent high-end of $190 million.

There were some softer spots beneath the headline growth. Net income fell 19% to $11.7 million, while Zig-Zag segment sales dropped 22.4% because of weaker wraps and papers shipments, and selling and marketing expenses also jumped sharply as the company poured money into expanding its oral nicotine business.

Ultimately, this sale looks like a risk management move after a strong run as opposed to a major loss of confidence in Turning Point. The stock has climbed more than 20% over the past year, and with tobacco-adjacent names facing constant regulatory and consumer trend uncertainty, trimming exposure after gains is not especially surprising.

Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Comfort Systems USA, Grand Canyon Education, Lam Research, Nvidia, and Sterling Infrastructure. The Motley Fool recommends Turning Point Brands. The Motley Fool has a disclosure policy.