I follow income stocks pretty religiously, though I’ll admit it’s been a while since I’ve looked at tobacco stocks. I sold my last tobacco stock – Marlboro maker Altria (MO) — about a year ago when I took a long, hard look at the dividend yield (then about 4%) and decided it no longer made sense to own as an income stock. At that price, there was a lot of potential downside and very little upside.

Or so I thought…

It seems I sold too soon. Altria’s stock price has enjoyed a nice 20% bump since then, and the yield has shrunk to just 3.6%. The stock trades for 23 times earnings… which is slight premium to the broader market.

Now, I’m not the biggest fan of bubbly tech stocks like Facebook (FB) or Amazon (AMZN). But I can promise you this: I’d much rather pay the current multiple of 84 times earnings for Facebook or even 460 times earnings for Amazon… even though I consider those valuations to be wildly excessive… because I believe that there is at least a chance that the companies could grow into those valuations. It could happen. But tobacco stocks operate in an industry in terminal decline. Cigarette sales volumes fall with every passing year, and the regulatory noose just keeps getting tighter.

Now, there is nothing wrong with buying a stock in a declining industry, particularly if you’re playing it as a short-term trade. And even as a long-term holding, it can make sense so long as you’re buying them as deep-value stocks and realizing a decent current return via an outsized dividend. But there is no scenario under the sun in which tobacco stocks should trade at a premium to the broader market. None. Nada. Zip.

This is how desperate investors are for yield these days. They’re willing to accept a sub-4% yield on a no-growth company in a slowly dying industry because they can’t find a better yield elsewhere.