Analyst Bastien Agaud of Bank of America Securities reiterated a Buy rating on British American Tobacco, retaining the price target of p4,600.00.
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Bastien Agaud has given his Buy rating due to a combination of factors including British American Tobacco’s strategic decision to divest its stake in ITC Hotels. This move is expected to help the company achieve its financial leverage target by the end of 2026, thereby strengthening its financial position. The divestment is anticipated to optimize pricing and contribute positively to investor sentiment.
Bastien also anticipates that BAT will likely update its FY25 guidance, with potential increases in revenue growth projections driven by strong performance in the US Modern Oral and Vapour segments. Despite a slight expected decrease in EPS for FY26 due to currency movements, BAT’s valuation remains attractive, trading at a significant discount compared to European staples. This, combined with the company’s growth prospects, supports the Buy rating.
In another report released today, Barclays also maintained a Buy rating on the stock with a £49.00 price target.