February 13, 2025
Top 10 Stock British American Tobacco Hold Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: British American Tobacco – Top 10 Stock in Employee Satisfaction Leaders in Europe
British American Tobacco is listed as a top 10 stock on February 13, 2025 in the market index Employee Focus EU because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 48 (48% performer), Obermatt assesses an overall hold recommendation for British American Tobacco on February 13, 2025.
Snapshot: Obermatt Ranks
| Country | United Kingdom |
| Industry | Tobacco |
| Index | FTSE All Shares, FTSE 100, FTSE 350, Dividends Europe, Employee Focus EU, Diversity Europe, Human Rights, Recycling |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View British American Tobacco Hold
| 360 METRICS | February 13, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 71 |
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| GROWTH | ||||||||
| GROWTH | 45 |
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| SAFETY | ||||||||
| SAFETY | 34 |
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| SENTIMENT | ||||||||
| SENTIMENT | 43 |
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| 360° VIEW | ||||||||
| 360° VIEW | 48 |
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ANALYSIS: With an Obermatt 360° View of 48 (better than 48% compared with alternatives), overall professional sentiment and financial characteristics for the stock British American Tobacco are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for British American Tobacco. Only the consolidated Value Rank has an attractive rank of 71, which means that the share price of British American Tobacco is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 71% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 45, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 34, meaning the company has a riskier financing structure than 66% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 57% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 43. ...read more
RECOMMENDATION: With a consolidated 360° View of 48, British American Tobacco is worse than 52% of all alternative stock investment opportunities based on the Obermatt Method. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 71. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 45), a riskier financing structure than the competition (Safety Rank of 34), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 43) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of British American Tobacco is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of British American Tobacco. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for British American Tobacco only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 43 (better than 43% compared with alternatives), overall professional sentiment and engagement for the stock British American Tobacco is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for British American Tobacco. Analyst Opinions are at a rank of 53 (better than 53% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 55, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 54, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 54% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 29, which means that currently, professional investors hold less stock in this company than in 71% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 43 (less encouraging than 57% compared with investment alternatives), British American Tobacco has a reputation among professional investors that is below that of its competitors. Not having too many professionals invested in British American Tobacco may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in British American Tobacco. ...read more
Value Strategy: British American Tobacco Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 71 (better than 71% compared with alternatives), British American Tobacco shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for British American Tobacco. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 73 which means that the stock price compared with what market professionals expect for future profits is lower than for 73% of comparable companies, indicating a good value concerning British American Tobacco's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 55, and for Dividend Yield with a Dividend Yield Rank of 98. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 93% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 7). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 71, is a buy recommendation based on British American Tobacco's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that British American Tobacco has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing British American Tobacco shares. ...read more
Growth Strategy: British American Tobacco Growth Momentum low
| GROWTH METRICS | February 13, 2025 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 35 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 29 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 41 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 91 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 45 |
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ANALYSIS: With an Obermatt Growth Rank of 45 (better than 45% compared with alternatives), British American Tobacco shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for British American Tobacco. Sales Growth has a below market rank of 35, which means that, currently, professionals expect the company to grow less than 65% of its competitors. The same is valid for Capital Growth, with a rank of 41, and Profit Growth, with a rank of 29. Currently, professionals expect the company to grow its profits less than 71% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 91, which means that the stock returns have recently been above 91% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 45, is a hold recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for British American Tobacco, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. ...read more
Safety Strategy: British American Tobacco Debt Financing Safety below-average
| SAFETY METRICS | February 13, 2025 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 39 |
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| REFINANCING | ||||||||
| REFINANCING | 24 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 56 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 34 |
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ANALYSIS: With an Obermatt Safety Rank of 34 (better than 34% compared with alternatives), the company British American Tobacco has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of British American Tobacco is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for British American Tobacco. Liquidity is at 56, meaning the company generates more profit to service its debt than 56% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 24, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 76% of its competitors. Leverage is also high at a rank of 39, which means that the company has an above-average debt-to-equity ratio. It has more debt than 61% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 34 (worse than 66% compared with alternatives), British American Tobacco has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: British American Tobacco Above-Average Financial Performance
| COMBINED PERFORMANCE | February 13, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 71 |
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| GROWTH | ||||||||
| GROWTH | 45 |
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| SAFETY | ||||||||
| SAFETY | 56 |
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| COMBINED | ||||||||
| COMBINED | 54 |
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ANALYSIS: With an Obermatt Combined Rank of 54 (better than 54% compared with investment alternatives), British American Tobacco (Tobacco, United Kingdom) shares have above-average financial characteristics compared with similar stocks. Shares of British American Tobacco are a good value (attractively priced) with a consolidated Value Rank of 71 (better than 71% of alternatives) but show below-average growth (Growth Rank of 45), and are riskily financed (Safety Rank of 34), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 54, is a buy recommendation based on British American Tobacco's financial characteristics. As the company British American Tobacco's key financial metrics exhibit good value (Obermatt Value Rank of 71) but low growth (Obermatt Growth Rank of 45) and risky financing practices (Obermatt Safety Rank of 34), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 71% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. ...read more
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