As 2011 comes to a close, it's a great time to look back at what happened to the stocks that interest you. By making sure you know the important things that a company accomplished -- as well as the setbacks it experienced -- you can make a better decision about whether it's a smart investment for your portfolio.

Today, let's take a look at Star Scientific (Nasdaq: CIGX). Many investors are uncomfortable with profiting from traditional tobacco companies, perceiving them as "sin" stocks. But with Star Scientific looking to emphasize dissolvable tobacco and developing a process to cure tobacco in a non-carcinogenic way, investors could see the stock as the best way to play the industry. Below, I'll take a closer look at the events that moved Star Scientific's shares this year.

Stats on Star Scientific

Year-to-Date Stock Return 18.5%
Market Cap $312 million
Total Revenue, Trailing 12 Months $960,000
Net Loss, Trailing 12 Months ($22.7 million)
1-Year Revenue Growth 24.7%
Cash / Debt $10.4 million / $5.7 million
CAPS Rating *

Source: S&P Capital IQ.

How did Star Scientific do this year?
Star Scientific is a tiny player in a huge industry. Tobacco is dominated by big companies like Altria (NYSE: MO), Reynolds American (NYSE: RAI), and Philip Morris International (NYSE: PM), all of which focus primarily on cigarettes. By contrast, Star Scientific doesn't make cigarettes at all.

But by focusing on alternatives, Star Scientific has actually been ahead of the curve. With smoking becoming a social stigma both in the U.S. and abroad, even the big companies in the industry are looking at smokeless products to help carry profits going forward.

The problem, though, is that Star Scientific hasn't yet found a way to become profitable. For instance, in the company's second-quarter results, revenue dropped 22% -- not a good sign for what's supposed to be a growing company. Even after big cost-cutting measures and moves to create a vastly improved balance sheet, the company is still producing some big losses. Moreover, the threat that Star Scientific's products may well be subject to just as stringent regulation as traditional tobacco looms large over its future prospects.

Investors are clearly hoping for huge growth from Star Scientific in the coming years. For now, though, the big dividends of Lorillard (NYSE: LO), Vector Group (NYSE: VGR), and other big-tobacco stocks look like more of a sure thing.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.