#MCunliffe1, with the share price down from a peak of 5500 in 2017 and the RJN takeout, down to 2350 today from 3100 a year ago, but now the debt to EBITDA has been cut in half, the Vape juice sector is about to be regulated and BATS are very neatly positioned with c50% of that market sewn up already..
Keep buying the weakness stake building should be a good long term strategy for the 10% yield until the share price picks up, if they do a BB in H2-2024 and miss the weakness we will have to wait and see..
At FY-2017 - total borrowings were GBP49.50BN, an increase of 30BN on 2016 for the RJN takeout.
At H1-2023 - total borrowings were GBP42BN with net debt 37BN
Debt is still way too high IMO, it needs to come down, but when you can save 10% on your dividend payouts with a BB, maybe a split is a good compromise..? |
The company expects 50 per cent of its revenues to be from these less harmful, non-combustibles by 2035, up from 17 per cent today. Leverage is also coming down with net debt to EBITDA having declined to 2.7 times in 2023 from 5.3 times in 2017, making additional stock buybacks and/or a dividend hike increasingly likely.. :o) |
Indeed, optimism there is. Thanks 0x3f.
I liked the statement:
“The FDA has confiscated more heads of romaine lettuce than it has illegal e-cigarettes in the last five years.”
Priceless. |
Thanks ox3f - reasons for optimism |
Good summary |
Comparison of Altria and BATS
hxxps://uk.investing.com/news/stock-market-news/altria-vs-british-american-tobacco-which-stock-is-smoking-hot-right-now-3320699 |
Good to see PM and BATS have come to an agreement regarding patent litigation for NGPs going forward between the two of them.I'd rather see stakeholders returns from profits made, rather than lining the pockets of expensive lawyers. |
Altria was up 4% in NY yesterday
Hopefully BATS will follow suit when they report |
NICE TO SEE ITS HOLDING ITS SMALL RISE AFTER PAYING DIVI.. |
Cracking divi landed into my account yesterday. Now looking for when to reinvest it. |
It's not the asset but the capital allocation after they bought it. Should have not increased the dividend and refinanced long term when interest rates were zero. Newport and Kent are gems. |
bti up 2% at end of day so could be a good rise in the morning here. 2360p possibly |
Reynolds massive writedown suggests massive overpayment. They took on too much debt for a vanity asset. |
Your first sentence is accurate, zicopele. |
They can't afford the buiyback. Lower debt and maintain dividend.
Debt has been too high since the disastrous purchase of Reynolds.
PS I should have sold BATS and bought more PBR for a proper dividend. |
$1bn buyback announced by Altria today
BATS should follow suit in H2 |
 Yes, nice dividend into my 'ii' account.
-----------------------
Liontrust duo prepared for a short-term hit at BATS
Short-term growth will take a hit from increased investment at British American Tobacco (BATS) but longer-term it will reap the benefits, says Liontrust duo Julian Fosh and Anthony Cross.
The Citywire Elite Companies AAA-rated tobacco giant is a top 10 holding in the managers’ Liontrust UK Growth fund, where it makes up 2.4% of the £37m portfolio.
A trading update at the end of the year saw BATS downgrade 2023 organic growth guidance to the low end of its 3%-5% range as macroeconomic pressures impacted US cigarette sales, pushing the shares 6.3% over December.
‘BAT is writing down the balance sheet value of some of its combustibles division brands by around £25bn,’ said Fosh and Cross.
‘The company is also accelerating investment in its shift towards ‘smokelessR17; products such as vapes and nicotine pouches. These investments will depress short-term growth but are expected to contribute positively from 2026 onwards.’
Shares in BAT were trading at £23.52 on Wednesday.
citywire.com |
dividend reinvested |
63 is the decimal equivalent of the hexadecimal 0x3f.
Retired software developer and ex smoker :-)
Bourbon beckons - DGE needs all the help it can get.
Cheers 63.
UPDATE: dug out an old Cobol/2 booklet to check the ASCII codes. Hex 3F is the ? character
I once delivered some charity products to a house in the hills above Oldham. Their house number was depitced in binary on an acrylic, shaped house sign. Hubby was in I.T. Wife just rolled her eyes. |
MCunliffe1, I take the point on buybacks. Many (most?) companies do it poorly. I can't comment on ABRDN, but with BATS on such a low multiple I can't see it being a mistake to do so. I'd expect the dividend to be maintained.
Reverse ITC takeover is something I've herd mentioned a couple of times. Interesting Idea.
All the best,
0x3F
PS Good detective work. 63 is an ASCII code... |
Hope1815: thanks, a considered explanation.
I had seen that the holding in ITC drops each year - due to the employee incentive scheme at ITC.
It's ironic really, I'm only holding BATS because of the dividend yield and the fact that it's paid quarterly helps. Perhaps BATS will have a similar view of their (albeit diminishing) large divi. paying investment. |
Thanks Number 63 - I do now know what aggresive means.
Using most of the free cash for the BB. Perhaps at the expense of the dividend? Or alongside the dividend?
ABRDN went through a BB, about 15% of the shares were bought back. The share price failed to move and the resulting cap. of the company caused it to drop from FTSE-100 to FTSE-250. It also reduced the number of the shares that a predator would need to buy to gain a control.
Same may work for BATS if the BB is aggresive enough. Perhaps ITC will reverse takeover.
See, 63, I thought want I wanted. :-) |
I did some research on ITC 78% of its revenue is from Tobacco within India (Growth of the Population is set to rise in the coming years and then flatten). ITC is going to float part of the Business and BATS will hold 17/19% which they want to sell.
The projection of ITC as a company is set to grow if forecasts are correct. In the meantime, Bats has lowered the Debt, controlled costs, maintained Revenue, and looking to expand its product line.
The only time to offload ITC is if someone else wants BATS shares. There seem a few suitors in India for that. I would think Bats will hold ITC for now and see how it progresses. It is always best to sell an asset when your asset has appreciated to the point that it might even be overvalued, selling can be a good way to realize other avenues of investment. Bats shares in ITC stand at 29.02% which each passing year will reduce.
British American Tobacco with no debt does seem appealing with constant Revenue. That is another discussion for another time.
The subject could be on Debt repayment ratio to ITC Dividend to BATS plus other subject matter on Bats Portfolio. (The debt repayment taken out does show Profit Growth). |
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