|Bid||0.00 x 2200|
|Ask||0.00 x 800|
|Day's Range||39.82 - 40.23|
|52 Week Range||31.60 - 41.58|
|Beta (5Y Monthly)||0.65|
|PE Ratio (TTM)||10.13|
|Forward Dividend & Yield||2.98 (7.49%)|
|Ex-Dividend Date||Jul. 08, 2021|
|1y Target Est||49.56|
Altria's (MO) low-risk tobacco offerings such as IQOS and on! are gaining popularity. Moreover, high pricing for tobacco products are an upside..
One of legendary hedge fund manager Paul Tudor Jones’s 10 golden rules of investment is “run your winners and cut your losers”, so it is with some trepidation that this column returns to British American Tobacco. The FTSE 100 stalwart has been a poor pick since our first look in 2017: a paper capital loss of more than 45pc, or almost £24 a share, is only partly offset by 726.6p a share in dividends. Despite the stock’s unpopularity, the powerful cash flow generated by the core tobacco business and the attractive valuation on the basis of both earnings and yield make us reluctant to cut and run. Investors who run rigorous environmental, social and governance (ESG) screens before they select a share will not even consider BAT and there are other good reasons for giving up on the stock, especially as the regulatory pressure on tobacco remains intense. The Tobacco Tax Equity Act proposed by the Democrats in America is just the latest example. The initiative, which would raise federal levies on tobacco products, came straight after suggestions that President Joe Biden’s party would also consider legislation to lower the nicotine content in cigarettes, in addition to re-examining a possible ban on menthol-flavoured products.
The Food and Drug Administration is following the lead of President Joe Biden's recommendation and proposing to ban all menthol cigarettes, the last flavor the regulatory agency allows for tobacco. The FDA plans to introduce new regulations within the next year outlawing its use in cigarettes and cigars. British American Tobacco (NYSE: BTI) would be hurt most by the proposal as its Newport brand is the top-selling menthol cigarette by far, though Altria (NYSE: MO) and other tobacco companies produce mentholated cigarettes, too.