British American Tobacco: A Cheap And Juicy Yield

The Asian Investor
29.39K Followers

Summary

  • British American Tobacco offers strong capital returns, driven by robust free cash flow and a low earnings-based valuation, making it a compelling value investment.
  • Momentum in alternative products like Velo is offsetting declines in traditional tobacco, supporting future growth in a challenging market.
  • Aggressive marketing and ambitious medium-term goals in smoke-free products position BTI for sustained top line and earnings momentum.
  • With a forward P/E below 10X and a high dividend yield of 6%, BTI is a rock-solid yield play, offering potential upside if shares re-rate to industry averages.

Traditional cigarettes and tobacco

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British American Tobacco (NYSE:BTI) (OTCPK:BTAFF) is a well-run tobacco company with a growing focus on alternative products like Vuse, glo and Velo that are meant to accelerate BTI’s top line and free cash flow growth. The company has laid

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Analyst’s Disclosure:I/we have a beneficial long position in the shares of BTI, MO either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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