In a report released today, Bastien Agaud from Bank of America Securities reiterated a Buy rating on British American Tobacco, with a price target of p4,500.00.
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Bastien Agaud has given his Buy rating due to a combination of factors that suggest British American Tobacco is positioned for growth. The company has released its FY25 Trading Update, indicating a revenue growth forecast of around 2%, which aligns with the consensus. Additionally, management has reaffirmed its medium-term growth algorithm, projecting revenue growth of 3-5% and adjusted EBIT growth of 4-6%, although FY26 is expected to be at the lower end of these ranges.
Bastien Agaud also highlights the anticipated improvement in the performance of combustibles in the US market during the second half of FY25, driven by strong price and mix dynamics. Furthermore, the company is expected to benefit from a crackdown on illicit products in the US and the launch of new products in international markets. Despite some challenges in the heated tobacco segment, the overall valuation of British American Tobacco remains attractive, trading at a discount compared to European staples, which supports the Buy rating.
According to TipRanks, Agaud is a 3-star analyst with an average return of 9.9% and a 66.67% success rate.
In another report released today, Jefferies also maintained a Buy rating on the stock with a £52.00 price target.