I've Been Bearish On British American Tobacco For Years But Now I'm Changing My Mind (Archive)
Turning long-held BTI bearishness into a high-conviction, value-backed Buy thesis.
This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.
Elevator Pitch
- BTI missed revenue estimates but is on the right track in transitioning away from combustibles at an accelerating clip.
- EBIT margins have improved due to higher profitability in new categories and cost savings, with further margin levers ahead in FY25 and over the next 5 years.
- Valuations are attractive, trading at a discount to peers, supported by rising earnings expectations.
- BTI vs SPX500 technicals point bullish, indicating outperformance potential over the next few quarters.
- Provision expenses from litigations against BTI's Canadian subsidiary is a key risk to monitor as there is no minimum liability.
Read the full article here.
Disclosures and Disclaimers
Past performance ≠ future results. Not investment advice. See full Disclaimer.
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