Published: July 9, 2010

If you're the type of person who blushes easily, you might want to stop reading now.

You see, the vast majority of companies operate businesses viewed as "respectable" by most of the public. These companies loan money... build cars... sell computers... any number of everyday needs.

But the market also has a seedier side. There are a handful of companies that operate businesses considered taboo by the majority of investors. These companies profit from things like selling cigarettes, operating strip clubs, and delivering steamy movies to adults.

And think what you will, operations that some see as controversial can be big business. For example, more than five trillion cigarettes are produced each year, which equals about 800 for every man, woman, and child on the planet. And in 2009, a down year for casino gambling, Nevada casinos raked in more than $5 billion in gaming wins... not to mention the cash earned from hotel rooms, restaurants, and show tickets.

With this in mind, I tracked down what might be the seven most taboo stocks on the market. Each is involved in a business that make some people embarrassed. But love them or hate them, you'll at least want to see who these names are and what they do.

Playboy Enterprises (NYSE: PLA)
Business: Adult-themed publishing
Fiscal Year 2009 Revenues: $240 Million

We start our list with the well-known Playboy Enterprises. Since its founding as a men's magazine in 1953 by Hugh Hefner, the company has grown to create and publish adult content in a variety of outlets. Today, its properties include Playboy TV, the Spice Network, and even a Playboy-themed nightclub in Las Vegas.

While we know that sex sells, that hasn't stopped Playboy from seeing its share price plummet. Competition from adult sites on the Internet have helped to chip away at the iconic company's share price, which has fallen to $4 per share from $22 in 2000.

Rick's Cabaret International (Nasdaq: RICK)
Business: Gentlemen's clubs
FY 2009 Revenues: $75 Million

Rick's has built an empire of gentlemen's clubs across the country. Operating under the names of Rick's, Onyx, Toostie's, and XTC, the company boasts more than 20 locations. It was even named one of America's 200 Best Small Companies by Forbes.

In addition to its clubs, Rick's also operates a media division and an adult auction site -- www.naughtybids.com (for obvious reasons, we'll abstain from linking to the website).

Philip Morris International (NYSE: PM)
Business: Tobacco
FY 2009 Revenues: $25 Billion

Many investors know that cigarette-maker Philip Morris changed its name to Altria several years ago. But not as many know that Altria spun off its international tobacco operations as Philip Morris International in 2008.

PM holds about 15% of the international cigarette market outside the U.S. and sells its products in more than 150 countries. Its labels include Marlboro, which has become the number one brand in the world, and seven of the top 15 brands worldwide.

Private Media Group (Nasdaq: PRVT)
Business: Adult content distribution
FY 2009 Revenues: $33 Million

Apart from a logo that contains the silhouettes of two women dancing, a visit to Private Media Group's website makes it difficult to tell exactly what the company does.

In short, the company produces and distributes adult content on the Internet, via DVD and magazines, and even on mobile phones.

Its business may be controversial, but that hasn't helped to boost the company's profile among investors. At press time it held a market cap of just $30 million and trades only 10,000 shares a day.

MGM Resorts International (NYSE: MGM)
Business: Casino resorts
FY 2009 Revenues: $6 Billion

How can you legally serve free alcohol to patrons in hopes that they will hand over their hard-earned money hour after hour? Run a casino, of course!

Gone are the days when gambling was relegated to smoky backrooms. Today, casino gaming is a multi-billion dollar business, and MGM represents the 800-lb. gorilla in the industry.

The company owns nine Las Vegas Strip casinos alone, in addition to a number of other properties throughout the U.S. and world.

New Frontier Media (Nasdaq: NOOF)
Business: Adult content distribution
FY 2009 Revenues: $50 Million

With a company tagline of "Publicly Traded, Privately Watched," you get a good idea of the business New Frontier operates. Distributing adult content is NOOF's bread and butter, as it operates nine adult pay-per-view networks to cable providers in the U.S.

The company also produces adult movies for channels like Cinemax and Showtime (and their international equivalents), along with adult websites that offer subscriptions. But just like Playboy, New Frontier has seen its share price plummet recently. In 2007 it traded above $10 per share, but now changes hands below $2.

The Vice Fund (VICEX)
Focus: Tobacco, alcohol, gaming, and defense stocks
1 Yr. Return: +35.1%

If the six stocks above weren't enough "sin" for you, how about an entire fund dedicated to vice stocks? The Vice Fund holds a basket of 36 stocks in the tobacco, alcohol, gaming, and defense industries. Its largest holding is Philip Morris International, which makes up nearly 15% of the fund.

The fund invests in vice stocks with the idea that they offer long-term defensive growth -- a fancy way of saying the stocks it holds should always see demand. So far, the results haven't been great. The S&P 500 has beaten out the fund over the past 1, 3, and 5-year periods.

-- Tanner Callais
Staff Writer
StreetAuthority