A selection of winners and losers in stocks rooted in the wages of sin

JOHN HEINZL

STARS
Smith & Wesson
SWHC - NASDAQ ($U.S.)
Everyone knows guns maim and kill. But consider the upside: Handgun maker Smith & Wesson expects revenue to jump 27 per cent in the current fiscal year, helped by higher sales to law enforcement, the U.S. military and folks who just like to carry a piece. You got a problem with that?

Diageo
DEO - NYSE ($U.S.)
With mega booze brands Smirnoff, Captain Morgan and Crown Royal, Diageo is the liquor cabinet to the world. And plenty of folks could use a stiff one, judging by Diageo's projected revenue of more that $19-billion (U.S.) in the current fiscal year. Shareholders are buying the next round.

Raytheon
RTN - NYSE ($U.S.)
War is hell. But to defence giant Raytheon, war is money - lots and lots of money. Raytheon is expected to rack up more than $23-billion (U.S.) in 2006 sales of missiles, military electronics and other essential instruments in America's selfless quest to bring, um, peace and stability to the world.

Canadian Oil Sands Trust
COS.UN - TSX ($CDN.)
Sure, Alberta's oil sands are a huge source of greenhouse gases and a potential environmental disaster in the making. But when the planet gets really toasty, think of all the gas money you'll save by not having to drive to Florida for the winter. Then we won't need the oil sands any more - if we're still breathing.

DOGS
Sportingbet
STI - LONDON (Pounds)
Offshore gambling companies had a nice little $12-billion (U.S.) business going that get little old ladies in Wichita play Texas Hold 'Em. Then those righteous Americans had to go and spoil it by arresting Sportingbet's chairman and outlawing Internet wagering. Anybody up for a trip to Vegas?

Rothmans
ROC - TSX ($CDN.)
Shares of cigarette maker Rothmans used to be smokin'. Then came contraband ciggies, ubiquitous smoking bans and rising lawsuit risks - not to mention all those loyal customers up and dying. No wonder the stock's been hacking and wheezing like an emphysema patient.

SOURCES: THOMSON FINANCIAL DATASTREAM and WWW.GLOBEINVESTOR.COM