British American Tobacco Share Discussion Threads

[this_time_its_different] 20/4/2018 09:23

BATS is a conviction buy at this price and dividend. BATS below £40 is a buy, BATS really should not be trading so low but panic selling caused this. People forget a lot of BATS business is in developing countries where the number of smokers is increasing as a percentage of population. I would seriously just keep buying till BATS gets over £40.

[steeplejack] 20/4/2018 09:11

I reckon that the company will increase the dividend,they paid a special last year.This is a massive cash flow business.At 36 quid and presuming a 10 per cent hike in normal dividend payments you are looking at a prospective yield of near 6 per cent.We might have this turning away from the bond proxy stocks but a yield of 6 per cent should restrict the downside.

[this_time_its_different] 20/4/2018 08:47

BATS has stabilised now, I hope the panic selling is over. The stock shouldn't struggle to get to £40, much more resistance after £50 I guess but that is a long way away at this rate.

[this_time_its_different] 20/4/2018 07:57

The dividend is well covered and tobacco is a high cash flow business, I don't see how they can't pay this 5.4% dividend for at least the next couple of years. Populations are rising over the world, so in the worst case I expect them to maintain the dividend rather than cut it, even with less % of smokers as a whole.

[philanderer] 19/4/2018 23:46

At tonight's close that's a 5.4% yield if they manage to pay an unchanged dividend.

[philanderer] 19/4/2018 23:35

I suppose those expert brokers will be out with their downgrades over the next few days ;-)

[zorija] 19/4/2018 21:37

Thanks Phil...

[philanderer] 19/4/2018 21:08

So many people were dumping stock it went into backwardation where the offer was less than the bid. Trading had to be halted .


edit: closing at 3600p in the US tonight.

[zorija] 19/4/2018 20:51

ttid,
What do you mean by 'halted on the' LSE ?

[this_time_its_different] 19/4/2018 20:20

BATS is a quality company with quality management with billions in revenue, the market is treating it like a penny stock. This is a defensive stock that has been subjected to a 8% drop and a trading halt on the London Stock Exchange, it is very rare to find a FTSE 100 company halted on the London Stock Exchange. Something is seriously wrong here, it is almost as if it is the perfect storm. Strengthening sterling, FDA nicotine reduction, tobacco volumes miss and a general inept ability of the market to see how people are not going to stop smoking tomorrow.

[this_time_its_different] 19/4/2018 20:09

Tobacco is safe in a recession, not when the FDA decide to reduce nicotine and make the industry disappear. The way BATS and Imperial are trading is as if the very nature of the tobacco industry is in threat. Imperial is now yielding 7.5%, if it goes lower, the yield moves over 8%. What FTSE 100 company yields 8% and isn't in distress? Imperial is not in distress and if the market wants to price it at a 8% yield, it is seriously wrong and you will end up with serious returns for the brave souls who jump in at that price.

[deadly nightshade] 19/4/2018 19:58

ttid i agree this is oversold but not sure i agree with you that it will not have further to drop, these mm's show no mercy when the daggers are out for a sector. imperial have taken a even bigger hammering then bats. so much for tobacco being a safe defensive share.

[this_time_its_different] 19/4/2018 19:37

During such scary periods, you should never forget two things: First, widespread fear is your friend as an investor, because it serves up bargain purchases. Second, personal fear is your enemy. It will also be unwarranted. Investors who avoid high and unnecessary costs and simply sit for an extended period with a collection of large, conservatively-financed businesses will almost certainly do well.

[this_time_its_different] 19/4/2018 19:24

BATS has been oversold, I've never seen it this bad in the tobacco sector.There is serious fear in the tobacco sector, which is unwarranted. It's almost as if all smokers are going to stop smoking tomorrow. The shares have moved from £55 to £36, a serious move down. I really can't see it going any lower, if this is not a buy at £36 I don't know what is.

The FDA nicotine reduction does not help and is the major contribution to the pessimism in the tobacco sector. What is ironic is the guy proposing the nicotine reduction has been put in place by trump (a republican candidate) who has received millions in donations by big tobacco.

The market has seriously mispriced BATS and I feel we are going to see a sharp move upwards sooner rather than later.

[essentialinvestor] 19/4/2018 16:04

ygor, Shire was a true value situation, and it's good to see those who
had the guts to hold being rewarded, I was not one of them!.
Would see BATS a little differently, this is a case of whether we are
at/nearing an inflexion point where sector volume contraction starts to erode profitability.
We may not be, many have forecast doom before and been very wrong.

[steeplejack] 19/4/2018 15:44

Chairman bought 4000 shares on 23 Feb at 42-36.

[ygor705] 19/4/2018 15:35

Philip Morris but not enough to justify this kind of movement. This is going to turn into a Shire-type situation I suspect. Big drop and, eventually, an even bigger recovery!

[philanderer] 19/4/2018 15:17

Next stop 3000p looking at the chart

[chiragmahe] 19/4/2018 15:11

shouldnt have bought :(

[dbensimon] 19/4/2018 15:04

This is incredible!!!

[chiragmahe] 19/4/2018 14:42

phillip morris results ....

[chiragmahe] 19/4/2018 14:35

why the break down?

[philanderer] 19/4/2018 14:30

That's gone......3720p next

[philanderer] 19/4/2018 13:36

Here comes the 3800p test.