British American Tobacco Share Discussion Threads

[minerve 2] 31/7/2020 14:14

Don't complain folks. If the business is doing good you can build your position for less cost with a falling share price and your returns get better.

Basically other opportunities attract investors ATM because they see them as cheap. They are cheap for a reason and amongst the delayed, cancelled and reduced dividends, the dilution via rights issues and increased debt it is going to be quite a long time before investors in the recovery stocks see previous levels of shareholder returns. Once they get those returns, if they do, they will then have to sell to reap the capital gain and then look around for another stock.

Meanwhile you can take 7%-10% a year dividend in the four US/UK main tobacco stocks buying in and recycling/compounding your returns at below intrinsic value.

The revenue pool for tobacco is actually predicted to grow over the next decade and which governments are going to really kill their cash generating cow of treasury revenue when they are more indebted than they have ever been? Are Amazon and Apple going to fill the gap? I don't think so.

[scepticalinvestor] 31/7/2020 14:06

insane dropthis market is bonkers!!

[lammergeier] 31/7/2020 11:28

The HEDGE FUNDS AND SHORTING BRIGADE are ontrolling the short term movemnts of shares

In the end actual performance and results in the long term will determine the share price

Twenty years ago these results would have greatly pleased the markets and the shares

would be well up.

It would be nice to know how many of the younger people buy any shares for the long

term or do they just gamble on shorting,margin bets and cfds

Its just a Casino now controlled by automatic mostly short selling machines.

[geckotheglorious] 31/7/2020 08:41

Going to nibble again here myself..

:)

[2vdm] 31/7/2020 07:59

I hope so, as I will be selling other stocks and buying BATS for the LT.

[unastubbs] 31/7/2020 07:31

yes, very good results. so obviously the share price will go down another quid.

[paulisi] 31/7/2020 07:18

Decent set of results

[kiwi2007] 31/7/2020 03:36

.the major reason they've now reached these levels is almost certainly 'ethical' considerations...here in NZ KiwiBank have just dropped tobacco (along with gambling etc.) from their pension and other portfolios. The UK’s largest pension scheme announced recently it will no longer invest in tobacco and will sell off its holding in the sector. It follows in the footsteps of Axa, Aviva, and the Dutch, Swedish and Norwegian government pension schemes, all of which have been busy permanently divesting their tobacco holdings.
No sign of this stopping yet and eventually it'll just be us retail investors, along with a few dodgy hedge funds, holding all the stock.

Or, if the price continues to fall lower, the management may look to take the companies private.

[andrewbaker] 30/7/2020 18:24

I am not trying to understand how BATS share price can fall to the current level or any level where a solid safe yield can be so much, with little perceived risk. Whether its ethical,health,morals,or whatever other reasons may be in the mix, this share is and will be for quite some time, a good investment for your money. Blackrock appears to have sold out in the past year, but other fund managers have neither bought nor sold, from what I can see. The previous remark suggests that whilst tobacco is a unloved product, and perhaps many people have sold on ethical grounds, causing the drop in price, it is still a sound investment at the current level - even at higher levels - for buyers to buy in or buy more. Personally my holding is so high, that I won't buy more, as to do so would unbalance my portfolio, but if the price drops much more, I just may have to! (And its PEG is under 1 {0.83, I believe}!)

[muscletrade] 29/7/2020 06:35

Altria : Cigarette Smoking Makes a Comeback During Coronavirus Pandemic -- Update
07/28/2020 | 04:52pm BST
By Jennifer Maloney

Americans are smoking more during the coronavirus pandemic because they are spending less on travel and entertainment and have more opportunities to light up. They are also switching back to traditional cigarettes from vaping devices in the wake of federal restrictions on e-cigarette flavors.

Those are the observations of executives at Marlboro maker Altria Group Inc., who said Tuesday that the shifts have been significant enough to slow the yearslong decline in U.S. cigarette sales. Altria now expects U.S. cigarette unit sales to fall by 2% to 3.5% this year compared with its previous projection of a 4% to 6% decline.

Pandemic lockdowns have meant fewer social outings and more time to smoke at home, Altria CEO Billy Gifford said. Though unemployment rates are high, stimulus checks and increased unemployment benefits have helped ease the financial hardship for low- and middle-income cigarette smokers, he added. Adult cigarette smokers are making fewer trips to the store, but they are stocking up on packs when they do go.

"Fewer social engagements allow for more tobacco-use occasions," Mr. Gifford told analysts on an earnings call Tuesday. The company's Marlboro brand accounts for 43% of all cigarettes sold in the U.S.

People have been switching back to cigarettes from e-cigarettes after the federal government earlier this year barred sales of many flavored vaping products, Altria said. The Food and Drug Administration in February halted the sale of fruit and mint flavors in cartridge-based e-cigarettes in an effort to curb a surge in underage vaping. Public health officials have said that sweet and fruity flavors are popular among young people.

As those restrictions took effect, Altria noted a shift among adult vapers, particularly those older than 50, back to cigarettes. "That consumer was faced with choices," Mr. Gifford said. "It benefited the entire cigarette category."

U.S. e-cigarette unit sales in the second quarter were down 14% from a year earlier, Mr. Gifford said, adding that the vaping's growth may pause over the next two years because the FDA is requiring e-cigarette manufacturers to submit all products for agency review by September or take them off the U.S. market.

The FDA didn't immediately respond to a request for comment. Agency officials have said that their first priority is curbing underage use. They also have noted that they allowed menthol-flavored e-cigarettes to remain on the market to provide opportunities for adult cigarette smokers to switch to a less harmful option.

Cigarette smoking is associated with more than 480,000 deaths per year in the U.S., according to the Centers for Disease Control and Prevention.

Altria made a big wager on e-cigarettes in 2018 when it invested $12.8 billion for a 35% stake in Juul Labs Inc. at a time when the startup was logging strong sales of its vaporizers and cartridges. But Altria has had to take $8.6 billion in charges on the investment as Juul's business slowed. The vaping industry leader has slashed jobs and pulled most of its flavors from the U.S. market.

Altria on Tuesday reported a second-quarter profit of $1.94 billion, compared with $2 billion a year earlier. Net revenue fell almost 4% to $6.37 billion.

The company projected adjusted earnings of $4.21 a share to $4.38 a share for 2020. In April, the company suspended its earnings outlook given uncertainty surrounding the Covid-19 pandemic. At the time, it was expecting adjusted earnings of $4.39 a share to $4.51 a share for the year.

Write to Jennifer Maloney at [e-mail]

[gary1966] 28/7/2020 09:34

Will be transfer of holding, probably between funds, not two sells.

[unluckyinvester] 27/7/2020 18:32

2x 41m sell off at end of play, anyone know anything?

[minerve 2] 24/7/2020 11:49

Perhaps. With companies the size of BATS though most of the FX effects are more market perception than reality to underlying economics.

[simba_] 24/7/2020 09:56

The share price weakness we're seeing recently is FX related, I believe. BATS now has significant earnings in dollars and its being devalued. This is also whats driving gold and commodities.

[gary1966] 23/7/2020 09:20

Yes from the start of the lockdown I agree but the COVID related falls in share prices started at the end of February, nearly a month earlier, when BATS was trading at between £33-34 and so it hasn't proved to be particularly defensive over that timeframe when I would have expected the tobacco companies to be the kind of shares where people would have wanted to put their money. You can add into the mix as well that tobacco companies appeal should also have increased due to the safety of the dividend at a time when most have been stopped or re-based/slashed.

[stepone68] 23/7/2020 09:07

Yeah Gary. It's tumbled UP ten percent since the start of lockdown.

[geckotheglorious] 22/7/2020 10:53

Tempted to nibble again here myself.
Long MO, and BAT.

Contemplating whether to buy PM, or more BAT..

Decisions decisions..

[gary1966] 22/7/2020 10:50

Yes don't understand it. Gold flying due to flight to safe havens yet a tobacco company that has got to be at the safe haven end of the spectrum is tumbling.

[buywell3] 22/7/2020 04:22

Even the Yanks now know that vaping and smoking is going to make their Covid-19 experience more like a :



Still smoking hot off the press

[thewheeliedealer] 21/7/2020 21:51

Hi all,

My mate Peter @Conkers3 and myself did a ‘Twin Petes Investing’ Podcast a few days ago and part of our discussion covers BAT. We also chatted about loads of other Stocks and as always a fair bit of general Portfolio Management educational stuff. Anyway, if you use Apple, Audioboom, Overcast or Spotify you can find it under the 'Conkers Corner' Channel (you want TPI Podcast 27) and you can find it on Soundcloud at the link below.

I hope you enjoy it and find it useful,

Cheers, WD
@wheeliedealer

[kiwi2007] 21/7/2020 10:43

I see Jefferies put a buy note out on Imperial (IMB) the same day and raised its price target to 2100p (from 1700p).