After dinner last Sunday at my mother’s house, it was a bit jarring to see this frail 85-year-old woman pull out an electronic cigarette and start “vaping.” She decided to give up tobacco cigarettes for e-cigs, on the assumption that vaping is less harmful.

Vaping entails the inhaling and exhaling of the vapor created by an e-cig, a battery-powered device that heats liquid nicotine in a disposable cartridge. So far, science has tentatively deemed e-cigs less harmful than traditional tobacco products, although only time will tell whether that verdict remains permanent.

But here’s my point for investors: My mother isn’t exactly an early adopter. She likes to knit wool sweaters while watching re-runs of 1970s sitcoms. In fact, she’s more of a barometer. If even my mom has embraced an emerging consumer trend, it’s well on its way to becoming the next big thing.

E-cigarettes are odorless, which means they can be enjoyed in public places (or as in my mother’s case, in the TV den without annoying the rest of the family). They’re also less expensive than traditional cigarettes, largely because they aren’t taxed.

E-cigs are indeed all the rage and they pose a challenge to traditional cigarette makers, but also a huge opportunity for investors who know how to exploit the trend. Below, I examine a familiar company that’s the best play on the vaping phenomenon.

But first, a few words about so-called sin stocks.

Some investors shun tobacco stocks, just as others refuse to put money into defense contractors, gun makers, gambling casinos, liquor distilleries, or even marijuana biotechs. Their moral qualms are understandable. But as an investor, I prefer to take the world as it is, not as I wish it to be. I leave emotion out of it.

The devil you know…

One of the surest ways to reap investment profits is to latch onto a fast-rising trend that’s still on the upward slope of the bell curve. The craze for e-cigs fits the bill. And if you want to get into the e-cig action, invest in the best-known “sin stock” of all — Philip Morris International (NYSE: PM).

Instead of using the word sin, think of PM as an “addiction” stock. As such, the company’s products are recession-resistant and should experience resilient demand even during the economic downturn that most analysts are predicting for 2017.

Based in New York City with a market cap of $171.5 billion, Philip Morris continues to expand into developing nations where an ascendant middle class covets the flashy Western consumer brands that seem synonymous with the good life. Chief among those brands: Philip Morris’ iconic Marlboro cigarettes.

However, as anti-smoking laws take hold in emerging nations, especially in cigarette-loving nations such as China and Russia, Philip Morris is seguing to e-cigarettes. E-cigs entail less regulatory oversight and give the company greater traction with a younger demographic.

Philip Morris started selling e-cigarettes in the second half of 2014, using existing technology that it has since been perfecting. The company recently introduced a “new and improved” e-cigarette that heats tobacco instead of liquid and doesn’t require batteries.

The growing popularity of e-cigs is a major tailwind that shows no signs of abating. Philip Morris and Altria Group (NYSE: MO), an international cigarette and table wine producer, are engaged in a partnership to sell electronic cigarettes. Philip Morris received exclusive rights to sell Altria’s e-cigarettes outside the U.S., whereas Altria got exclusive rights in the U.S. to sell other Philip Morris-manufactured tobacco products.

Global e-cig revenue is expected to post multiyear, double-digit growth, a level of prosperity not seen by the tobacco industry since the halcyon days of the 1950s and 1960s, when the “Don Drapers” of the era chain-smoked with abandon almost anywhere they wanted.

UBS (NYSE: UBS) and Wells Fargo (NYSE: WFC) project a $10 billion e-cig market by the end of 2017, up from $2.7 billion in 2014 and only $500 million in 2012.

The explosion of e-cigs has spawned a host of small-cap, entrepreneurial companies into the space, akin to the dynamic now unfolding in the medical marijuana industry. But many of these companies are poorly capitalized and face an inevitable shakeout.

That’s why the smartest way to leverage the e-cig boom is Philip Morris, a familiar sin stock and also a multi-billion-dollar blue chip behemoth with a high dividend.

For its fourth quarter of fiscal 2016, Philip Morris reported a 52% year-over-year surge in earnings and a 9.1% increase in revenue. Operating income gained 37.4% year over year due to lower marketing and administration costs.

With a trailing 12-month price-to-earnings (P/E) ratio of 24.6, PM is a bit pricey compared to the tobacco industry (13.4), but the company’s growth prospects are worth the premium.

The average analyst expectation is that year-over-year earnings growth next quarter will come in at 6.1%. Earnings growth is pegged at 7.8% for the current fiscal year, 10.6% for next year, and 9.8% for the next five years (on an annualized basis). Shares are up roughly 21% year to date.

With a strong balance sheet, proven management and a vast global footprint, Philip Morris is the safest way to profit from e-cig growth, as traditional cigarette use declines. Instead of letting e-cigs eat its lunch, Philip Morris is pivoting to co-opt the e-cig phenomenon. The dividend yield of 3.79% is a sweetener.

Got a question or feedback? Drop me a line: mailbag@investingdaily.com — John Persinos

Rapid profits can be yours…

As the e-cig phenomenon shows, technological change even affects Big Tobacco. That’s why you need to stay alert to emerging opportunities that can generate rapid profits for the early investors.

Along those lines, Jim Pearce, chief investment strategist of Personal Finance, put his team of analysts to work with the goal of proving the moneymaking power of a system called Rapid Profits Matrix.

Their startling conclusion: the system has outperformed buy and hold up to 4.9 times in direct competition… without resorting to day trading or complicated options. Click here for the full story.