Shares of Turning Point Brands (TPB) - Get Report were rising sharply Tuesday after the rolling paper and cigar company reported quarterly results that beat estimates, while also raising its full-year guidance.
The Louisville, Kentucky company reported first quarter net income that increased to $11.8 million from $7.3 million a year ago. The company also reported adjusted earnings of 80 cents per share on revenue that rose 18.7% year-over-year to $107.6 million.
Analysts were expecting adjusted earnings of 57 cents per share on revenue of $100.1 million, according to FactSet.
Turning Point shares were rising 8.2% to $52.54.
"Our first quarter results demonstrated solid execution with year-over-year growth significantly outpacing our end markets," said CEO Larry Wexler.
The firm said that its Zig-Zag rolling papers brand saw over 40% sales growth in the quarter and its Stoker's brand also delivered double-digit growth.
"As such, our core segments are continuing to perform well despite the tough comparables from the previous year period," Wexler said.
Turning Point raised its full-year guidance based on the strength of the first quarter results. The company now expects net sales of $422 million to $440 million, up from its previous guidance between $412 million and $432 million.
This guidance assumed double-digit percentage sales growth for Zig-Zag and high-single-digit sales growth for its Stoker's Products.
Analysts are expecting revenue of $425.9 million for the year.
"With more states advancing legalization efforts during the quarter, the segment’s outlook continues to improve as a result of the secular industry growth trends that we are seeing across the board," said Graham Purdy, COO of Turning Point.