British American Tobacco (BTI) AI Stock Analysis

• Market Cap: $118.35B
• Dividend Yield: 5.36%
• Average Volume (3M): 4.03M
• Price to Earnings (P/E): 30.2
• Beta (1Y): -0.03
• Revenue Growth: 0.48%
• EPS Growth: N/A
• Country: US
• Employees: 48,989
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Tobacco
• EPS (TTM): 2.15
• Shares Outstanding: 2,183,394,800
• 10 Day Avg. Volume: 4,113,778
• 30 Day Avg. Volume: 4,031,936
• PEG Ratio: -0.17
• Price to Book (P/B): 1.29
• Price to Sales (P/S): 2.48
• P/FCF Ratio: 6.75
• Enterprise Value/Market Cap: 1.24
• Enterprise Value/Revenue: 5.72
• Enterprise Value/Gross Profit: 6.86
• Enterprise Value/Ebitda: 18.18
• 1Y Price Target: $51.00
• Price Target Upside: -8.54% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 2
• EPS Forecast (FY): 4.54
• Revenue Forecast (FY): $34.28B

• Rating: 52 Neutral
• Price Target: $52.00 ▼(-6.74% Downside)

The overall stock score for British American Tobacco is primarily influenced by its financial performance and technical analysis. The company's strong cash management and debt-free balance sheet are positive, but challenges in profitability and bearish technical indicators weigh on the score. The valuation is somewhat supported by a high dividend yield, though the P/E ratio suggests overvaluation.

British American Tobacco Business Overview & Revenue Model

Company Description

British American Tobacco (BAT) is a leading global tobacco and nicotine company headquartered in London, UK. With a presence in over 180 markets, BAT operates in the sectors of traditional tobacco products and next-generation products (NGPs) such as e-cigarettes and heated tobacco. Its core product portfolio includes well-known cigarette brands such as Dunhill, Lucky Strike, and Pall Mall, alongside a range of NGPs designed to cater to the evolving preferences of consumers seeking alternatives to traditional smoking.

How the Company Makes Money

British American Tobacco generates revenue primarily through the sale of its tobacco products, including cigarettes and other traditional tobacco items, which remain the largest portion of its income. The company has also been expanding its revenue streams through next-generation products (NGPs), which include e-cigarettes and heated tobacco products, catering to the growing market of consumers looking for reduced-risk alternatives. Key revenue streams include direct sales to retailers, wholesalers, and distributors, as well as partnerships with various stakeholders in the tobacco and NGP sector. Additionally, BAT invests in innovation, marketing, and distribution strategies to enhance its product offerings and increase market share, contributing significantly to its earnings.

British American Tobacco Financial Statement Overview

Summary

British American Tobacco demonstrates resilience in its financial structure with zero debt in 2024 and strong cash management. However, challenges in revenue growth and profitability, including a negative net profit margin and volatile net income, impact the overall financial performance.

Income Statement

British American Tobacco's income statement reveals mixed performance. The gross profit margin remains robust at 82.8%, indicating strong cost management. However, the company has faced challenges with volatile net income, evident from the negative net profit margin of -52.7% in 2023, primarily due to a significant EBIT loss. Recent revenue growth has been stagnating, with a 5.19% decline from 2022 to 2023, raising concerns about future growth prospects.

Balance Sheet

The balance sheet reflects a stable financial position with zero debt in 2024, which is a positive turnaround from previous years. The equity ratio is healthy at 41.8%, showcasing a solid capital structure. However, the return on equity has been inconsistent, with a significant drop in 2023 due to negative net income. The company's asset base remains strong, supporting long-term stability.

Cash Flow

Cash flow analysis indicates steady operational cash generation, with a 5.5% increase in free cash flow from 2023 to 2024. The operating cash flow to net income ratio was significantly impacted in 2023 due to negative net income, but the free cash flow has remained positive, reflecting effective cash management despite earnings volatility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	25.60B	25.87B	27.28B	27.66B	25.68B	25.78B
Gross Profit	21.34B	21.43B	22.39B	22.85B	21.09B	21.33B
EBITDA	8.05B	7.74B	13.28B	12.23B	11.19B	11.78B
Net Income	3.09B	3.07B	-14.37B	6.67B	6.80B	6.40B
Balance Sheet
Total Assets	110.23B	118.90B	118.72B	153.55B	137.37B	137.69B
Cash, Cash Equivalents and Short-Term Investments	4.89B	5.81B	2.96B	4.03B	3.27B	3.38B
Total Debt	35.33B	36.95B	39.73B	43.14B	39.66B	43.97B
Total Liabilities	63.05B	68.90B	65.78B	77.84B	69.96B	74.73B
Stockholders Equity	46.87B	49.64B	52.57B	75.37B	67.10B	62.67B
Cash Flow
Free Cash Flow	8.67B	9.52B	10.25B	9.87B	9.19B	9.28B
Operating Cash Flow	9.27B	10.13B	10.71B	10.39B	9.72B	9.79B
Investing Cash Flow	954.00M	1.38B	-296.00M	-705.00M	-1.14B	-783.00M
Financing Cash Flow	-11.39B	-10.63B	-9.31B	-8.88B	-8.75B	-7.90B

British American Tobacco Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 55.76
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BTI, the sentiment is Positive. The current price of 55.76 is above the 20-day moving average (MA) of 52.41, above the 50-day MA of 52.88, and above the 200-day MA of 46.69, indicating a bullish trend. The MACD of 0.70 indicates Negative momentum. The RSI at 71.54 is Negative, neither overbought nor oversold. The STOCH value of 95.38 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BTI.

British American Tobacco Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TPB	67 Neutral	$1.96B	36.27	22.54%	0.29%	6.71%	8.16%
RLX	67 Neutral	$2.83B	28.22	4.56%	0.34%	61.64%	16.76%
MO	66 Neutral	$97.41B	11.07	―	7.05%	-0.96%	-11.42%
UVV	64 Neutral	$1.33B	12.01	7.72%	6.26%	3.01%	-7.14%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
PM	62 Neutral	$238.77B	27.78	―	3.52%	7.72%	-12.45%
BTI	52 Neutral	$118.35B	30.21	5.97%	5.36%	0.48%	―

British American Tobacco Corporate Events

British American Tobacco Reports Resilient Half-Year Performance

British American Tobacco (BAT) is a leading global tobacco company, engaged in the production and sale of cigarettes, smokeless products, and other nicotine products, with a strong focus on innovation and new categories. In its latest half-year report, British American Tobacco announced a slight decline in reported revenue by 2.2% due to currency headwinds, but a 1.8% increase at constant exchange rates. The company highlighted a return to growth in the U.S. market, driven by the success of its Velo Plus product and improved performance in combustibles. Key financial metrics showed a 19.1% increase in reported profit from operations, with a significant rise in operating margin to 42.0%. The company’s smokeless products now account for 18.2% of group revenue, reflecting a strategic shift towards new categories. BAT’s management remains optimistic about meeting its full-year guidance, with expectations of continued growth in new categories and strong cash generation. The company is committed to delivering sustainable value for shareholders through strategic investments and a robust share buy-back program.