GE was a great business under Lord Weinstock.Lord Simpson was an idiot. |
We don't want them to high on 1st Feb, payday with our dividend reinvestment. More bang for our buck, lower the shareprice, lol. |
monty: the share price is now heading in the right direction without the assistance of any buy back. The time to have used a BB efficiently has passed. |
“The big money is not in the buying and selling but in the waiting.” Charlie Munger (1924–2023). |
Last year dog of the year, will it turn out best in show this year, we want increased dividend and if possible buybacks, also don't sell the stake, the jewel in the crown, ITC. |
Weinstock must have been turning in his grave Shocking destruction of a great business GEC to Marconi |
lippy4: I like those kind of stories. They make the thread more human. Thanks. |
in the US the price is climbing equivalent to 2396p at the moment. Quite often it falls back at the end of the trading day |
good point redbaron10 |
Car1pet ITC and Japan Tobacco are conglomerates with various interests.Both have hotels,ITC has an agri-business,JT has a food processing business.Diversifying into growth areas outside tobacco isn't impossible but I'd like a lot of due diligence first if they plan such a move.I remember GE before Lord Simpson turned it into Marconi and see how that ended! |
In a roundabout way, Bats is a cheap way to have an interest in a great company ITC, if you fancied ITC. |
#Montyhedge, the ITC holding is indeed a jewel, a 37% FY CG and 29% of the dividend paypout.. :o)
The Groups interest in ITC decreased from 29.38% in 2021 to 29.19% in 2022
The Groups share of post-tax results of associates and joint ventures increased from £415M to £442M which largely relates to the performance of the Group’s main associate, ITC Ltd (ITC) in India. The Group’s share of ITC’s post-tax results was 22.7% higher at £514M (2021: £419M).
Added a few more BATS this morning and will continue to do so through H1, the steep discount and 10% yield makes it a great buy for income, yes there was a write down, but I doubt it will impact the dividend.. |
Given the future for smoking is looking problematic could BATS re-invent itself and use its cash to transition into a different business for example manufacturing batteries for EVs or new businesses not even thought of. What are the best opportunities for the next 20 years |
Also you forgot to mention year to date ITC up 39.7%, it's the jewel in Bats crown for me. |
 British American TobaccoBritish American Tobacco's (BATS) 2023 organic revenue growth is now expected to come in at the bottom of the 3-5% range, as US combustible sales stay under pressure. That's seen pressure on the valuation over 2023. And while these headwinds are likely to continue in the new year there's still room for hope.New Categories are expected to have been broadly breakeven last year, two years earlier than originally thought. The group has set a punchy goal for non-combustibles to drive 50% of revenues by 2035. We see regulatory scrutiny as the biggest potential blocker here.Our case for BATS centred on its strong cash generation. With expected cash conversion of close to 100% we still think the company's well placed to make the necessary investments to keep pivoting away from cigarettes.It also leaves room to support an attractive dividend yield, which is now in double digit territory after a steady decline in the company's market value. As ever though, there are no guarantees and yields are not a reliable indicator of future income.The weakness in the valuation suggests that there's still a job to be done in convincing investors that New Categories can underpin BATS' future. Successful execution of the strategy could well drive a re-rating, but it won't be an easy task. |
I dont think they overpaid for Reynolds this was one of the last big deals in the tobacco industry the issue was afterwards. They should have rebased the dividend and over the last couple of years refinanced and extended all the maturities of their debt at rock bottom rates. Anheuser or Vodafone have excellent debt profiles for example. |
McC it's not complex maths we're talking and doesn't take a day to check - how could a 29% stake in a 70 billion dollar company be worth 535 million quid? |
Zic: understand now - thanks. We are on the same wavelength.
Ant08: my math may be somewhat wrong. I'll double check my figures tomorrow. |
ITC is valued at c.£55bn so BAT’s 29% interest is worth £16bn or to put it another way nearly 30% of BAT’s market cap |
MCunliffe1,
What I meant is that if you put £300k in a SIPP with a bunch of blue chip high yielding stocks, effectively you have an inflation linked annuity of say £21k and as you say keep the capital.
It is not bad at all. My list was not exhaustive. There are plenty out there. |
About £535m monty |
I think investors forget about Bats stake in ITC little jewel in Bats crown, what's that worth? |
zicopele: now is perhaps a better time to buy an annuity than, say, 3-5 years ago. I was particularly good for annuities a few months back when interest rates were high and bond yields likewise.
My alternate view however is to invest you money instead into a range of high dividend payers very much as you've stated. But, for the same of clarity, such investments would NOT constitute an annuity and would NOT be guaranteed.
What is likely though, albeit also NOT guaranteed, is some return of capital perhaps after your death where your inheritors can sell your shareholding in those divi payers. Such is guaranteed NOT to be the case with a true annuity. The capital outlay dies with you although you could have arranged for continued payment to a spouse at the outset. Once the spouse passes so does the capital investment.
I prefer to retain control and hence I've swerved annuities instead investing in a SIPP. Early days, so we'll see how things pan out.
I could perhaps add RECI and TFIF to your list zicopele.
Nice one lippy4. |
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