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Tobacco stocks took a dive after a Wall Street analyst said JUUL is “eating their lunch.”

Financial analysts now recognize that vaping is a real threat to the cigarette industry, and perhaps for the first time companies that have practically minted money with their deadly products may be seriously worried about the future.

“Anyone here from Altria?” asked Clive Bates at E-Cigarette Summit in Washington. “I’m sorry, but JUUL does seem to be eating your lunch — something I’m really glad about.”

Tobacco stocks tumbled after Citigroup investment analyst Adam Spielman downgraded Altria (the American arm of the worldwide Philip Morris compex) from “buy” to “neutral.” Spielman credited the success of JUUL for the downgrade. The next day came an anemic earnings report from Philip Morris International (PMI), in which the tobacco giant admitted slowing Japanese sales of its IQOS heat-not-burn product.

In a widely shared April segment of CNBC’s Mad Money show, host Jim Cramer took aim at Marlboro manufacturer Altria and gleefully described how the stodgy cigarette makers are being upended by the upstart vape industry.

“Last week investors realized practically overnight that the tobacco industry is facing an existential threat from its vaporizer competitors, led by JUUL Labs” said the longtime Wall Street analyst. “Over the course of three short days,” said Cramer, “the tobacco stocks were bent, they were spindled and they were mutilated by the realization that electronic cigarettes have become a serious threat to the old-school cigarette makers.”

Meanwhile, the vaping industry, led by JUUL, is grabbing the cash that used to go to Marlboro and other cigarette brands. Nielsen, which tracks sales in the usual cigarette channels, says cigarette volume was down six percent for the first quarter of 2018. Meanwhile, JUUL now owns 60 percent of the Nielsen-tracked vaping market, and those dollars are coming from smokers who used to buy Big Tobacco’s cigarettes.

“[JUUL] is selling like crazy and it’s really eating into the tobacco industry in a way that other e-cigs never could,” Cramer said. “According to Nielsen, U.S. cigarette volumes shrank by six percent in the first quarter, substantially worse than expected, and Spielman ascribes the difference to Juul.”

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