What's going on?

The world�s largest beer brewer, AB InBev (ABI), and the world�s second-biggest cigarette maker, British American Tobacco (BAT), both reported annual results which puffed past investors� forecasts on Thursday.

What does this mean?

ABI�s fourth-quarter sales hopped up in almost every region � and investors raised a glass to the company�s promise of even stronger growth this year, sending its shares up 4%. The brewer is thirsting after a way to reduce the $100 billion debt it racked up buying its biggest rival in 2016; last year�s efforts were watered down by falling currency values in emerging markets which translated into fewer revenue dollars.


Currency woes were also a drag for BAT�s 2018 earnings � but the tobacco firm still managed to burn through investors� forecasts and announce a higher-than-expected dividend.

Why should I care?

For markets: Confidence is key, but so is pragmatism.

Both companies made upbeat statements about their prospects for 2019 � but investors appeared only to believe ABI. While BAT is unlikely to have been smoking anything too crazy � unlike rival Altria � investors probably sold off its stock, which fell 2% on Thursday, due to the continued uncertainty about its future in the US. Tighter regulation � primarily targeted at teens� choice, e-cigarettes � threatens to stub out its popular menthol-flavored ciggies too.

For you personally: Sin City has its virtues.

Shares of companies which enable vices like drinking and smoking are sometimes referred to as �sin stocks�. Some investors avoid investing in such companies for ethical or religious reasons � and investment advisors, be they machine, human, or hybrid, can point such investors in the direction of �socially responsible� alternatives with fewer negative effects (like alcoholism or organ damage). But those undesirable characteristics are precisely what make such companies attractive to other investors: customers are often hooked on their products, and would-be competitors may have too many scruples. Cigarette prices have risen relentlessly around the world, yet BAT still sold 5% more of its most important brands� cigarettes last year than it did in 2017.