As Big Tobacco Smolders, Booze Makers Get Higher on Pot

Cigarette makers and the budding marijuana industry seem like a natural fit. But alcoholic-beverage companies are the ones leading investors to, well, the green.

Tobacco giants Altria Group Inc. and Philip Morris International Inc. are among the worst-performing consumer stocks in the S&P 500 this year, as cigarette consumption declines and innovative products remain only a tiny source of revenue. Contrast that with the situation over at Constellation Brands Inc. and Diageo Plc, which are both trading near all-time highs as they get a head start in expanding beyond booze and into the cannabis space. Their share-price gains aren’t entirely due to such investments (in fact, Constellation’s stock has bounced around this year as shipping costs eat into beer profits). But cannabis is the next growth frontier and shareholders are cheering the early movers.