Tobacco. Liquor. Firearms. All highly profitable, and yet frowned upon for a variety of reasons: family tradition, religious beliefs, political leanings, or health consequences. Yet such products are not just desired--they have generated thriving industries. Corporations have made lucrative fortunes branding, marketing, and packaging these 'sins' to people who have lapped them up like forbidden holy-water. Therefore their stocks, ('sin' stocks, if you will) are, to certain clientele, desirous.
It is crucial to note that the phrase 'sin' stock is used more as a catchy alliterative description rather than a moral judgement. It typically includes industries such as alcohol production, gambling, and more salient chains of gentlemen's clubs, in addition to less harmful self-indulgences, such as vanity and arguably gluttony. While firearm production -- and defense industries in general -- are not usually considered 'sin' stocks, they can arguably be grouped into the same category due to their similar negative, reverberating effects when proliferation runs amok (such as arms-trafficking). Some examples of high-profile 'sin' stocks are: Smith & Wesson Holding Corps.
Why exactly would a potential investor find a 'sin' stock attractive, or conversely, why not?
As Don Draper (an iconic smoke-inhaler and scotch-imbiber) said in TV show Mad Men, "People were buying cigarettes before Freud was born." Why people seek sin is difficult to explain. But psychology aside, the long-scale success of these companies, and in some cases the lobbies they've built and sustained, can seem indestructible to someone looking for a good bet. Some investors, though, refuse to put their money into a company that may conflict with their own beliefs. Given the stocks' robust reluctance to bend to recessions, some people not only see value in 'sin' stocks, but in turning them toward some sort of benefit. Short of returning to a Prohibition Era regarding all 'immoral' commodities, nothing can really be accomplished regarding their total ban, or making them taboo.
Well, not entirely. Recently, students have turned against investment in "dirty energy companies" as a way to condemn their practices and encourage huge corporations such as Exxon Mobile