British American Tobacco p.l.c.

DB:BMT Stock Report

Market Cap: €79.1b

British American Tobacco Valuation

Is BMT undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of BMT when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: BMT (€35.79) is trading below our estimate of fair value (€84.02)

Significantly Below Fair Value: BMT is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for BMT?

Key metric: As BMT is unprofitable we use its Price-To-Sales Ratio for relative valuation analysis.

The above table shows the Price to Sales ratio for BMT. This is calculated by dividing BMT's market cap by their current revenue.
What is BMT's PS Ratio?
PS Ratio2.5x
SalesUK£26.18b
Market CapUK£66.01b

Price to Sales Ratio vs Peers

How does BMT's PS Ratio compare to its peers?

The above table shows the PS ratio for BMT vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PSEstimated GrowthMarket Cap
Peer Average5.2x
MO Altria Group
4.8x1.0%US$96.2b
ITC ITC
7.9x7.0%₹6.0t
2914 Japan Tobacco
2.5x4.4%JP¥7.6t
PM Philip Morris International
5.5x6.6%US$203.2b
BMT British American Tobacco
2.5x1.9%€66.0b

Price-To-Sales vs Peers: BMT is good value based on its Price-To-Sales Ratio (2.5x) compared to the peer average (5.2x).

Price to Sales Ratio vs Industry

How does BMT's PS Ratio compare vs other companies in the Global Tobacco Industry?

11 CompaniesPrice / SalesEstimated GrowthMarket Cap
BMT 2.5xIndustry Avg. 2.1xNo. of Companies11PS01.63.24.86.48+
11 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Sales vs Industry: BMT is expensive based on its Price-To-Sales Ratio (2.5x) compared to the Global Tobacco industry average (2.1x).

Price to Sales Ratio vs Fair Ratio

What is BMT's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

BMT PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio2.5x
Fair PS Ratio3.8x

Price-To-Sales vs Fair Ratio: BMT is good value based on its Price-To-Sales Ratio (2.5x) compared to the estimated Fair Price-To-Sales Ratio (3.8x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst BMT forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
Current€35.79
€37.47
+4.7%
18.7%€52.69€29.94n/a10
Nov ’25€32.29
€37.57
+16.4%
18.7%€52.83€30.02n/a10
Oct ’25€33.23
€38.13
+14.7%
17.4%€52.71€30.55n/a10
Sep ’25€33.74
€36.75
+8.9%
17.2%€51.24€29.11n/a12
Aug ’25€33.10
€36.87
+11.4%
17.9%€52.23€29.68n/a12
Jul ’25€29.08
€36.11
+24.2%
18.9%€51.81€28.26n/a12
Jun ’25€28.60
€36.16
+26.4%
18.7%€51.75€28.23n/a12
May ’25€27.55
€36.15
+31.2%
19.9%€51.10€27.87n/a12
Apr ’25€28.37
€36.35
+28.1%
19.9%€51.52€28.10n/a12
Mar ’25€27.63
€36.36
+31.6%
19.2%€51.42€28.05n/a13
Feb ’25€27.60
€36.53
+32.4%
18.9%€51.49€28.08n/a13
Jan ’25€26.57
€36.79
+38.5%
17.8%€49.91€26.70n/a15
Dec ’24€29.57
€40.97
+38.6%
15.4%€54.92€32.14n/a15
Nov ’24€28.83
€40.69
+41.2%
15.0%€54.35€31.80€32.2915
Oct ’24€29.86
€40.71
+36.3%
14.9%€54.46€31.87€33.2315
Sep ’24€30.60
€41.51
+35.7%
14.6%€55.17€32.28€33.7416
Aug ’24€30.62
€41.44
+35.4%
14.4%€54.78€32.05€33.1016
Jul ’24€30.66
€41.79
+36.3%
13.8%€54.66€31.98€29.0816
Jun ’24€30.12
€43.61
+44.8%
11.5%€54.36€32.39€28.6016
May ’24€33.58
€43.18
+28.6%
9.0%€53.23€35.11€27.5517
Apr ’24€32.68
€43.26
+32.4%
8.7%€53.10€35.02€28.3717
Mar ’24€35.68
€43.62
+22.3%
7.3%€53.21€39.62€27.6318
Feb ’24€35.47
€44.78
+26.3%
7.7%€52.95€39.43€27.6018
Jan ’24€37.57
€46.87
+24.8%
8.4%€55.81€40.69€26.5718
Dec ’23€39.50
€46.97
+18.9%
8.4%€55.83€40.71€29.5718
Nov ’23€40.25
€47.89
+19.0%
9.2%€55.80€40.69€28.8318

Analyst Forecast: Target price is less than 20% higher than the current share price.

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