British American Tobacco p.l.c.

JSE:BTI Stock Report

Market Cap: R1.4t

British American Tobacco Valuation

Is BTI 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 BTI when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: BTI (ZAR631.4) is trading below our estimate of fair value (ZAR1148.29)

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

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

BTI key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue3.6x
Enterprise Value/EBITDA7.4x
PEG Ration/a

Price to Sales Ratio vs Peers

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

The above table shows the PS ratio for BTI vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PSEstimated GrowthMarket Cap
Peer Average5x
ITC ITC
8x7.0%₹6.0t
MO Altria Group
4.5x1.0%US$91.8b
2914 Japan Tobacco
2.4x3.7%JP¥7.3t
PM Philip Morris International
5.2x6.6%US$205.5b
BTI British American Tobacco
2.3x1.9%R60.4b

Price-To-Sales vs Peers: BTI is good value based on its Price-To-Sales Ratio (2.3x) compared to the peer average (5x).

Price to Earnings Ratio vs Industry

How does BTI's PE Ratio compare vs other companies in the Global Tobacco Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a0%
 n/an/an/a
No. of CompaniesPS048121620

Fetching data

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a0%
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Price-To-Sales vs Industry: BTI is expensive based on its Price-To-Sales Ratio (2.3x) compared to the Global Tobacco industry average (2.1x).

Price to Sales Ratio vs Fair Ratio

What is BTI'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.

BTI PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio2.3x
Fair PS Ratio7.5x

Price-To-Sales vs Fair Ratio: BTI is good value based on its Price-To-Sales Ratio (2.3x) compared to the estimated Fair Price-To-Sales Ratio (7.5x).

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 BTI forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentR631.40
R719.95
+14.0%
18.7%R1,012.23R575.13n/a10
Oct ’25R634.20
R741.50
+16.9%
17.3%R1,006.33R583.21n/a11
Sep ’25R660.10
R744.31
+12.8%
17.2%R1,020.65R579.91n/a13
Aug ’25R646.25
R740.25
+14.5%
18.0%R1,029.91R585.17n/a13
Jul ’25R565.45
R726.23
+28.4%
19.0%R1,022.21R557.57n/a13
Jun ’25R579.00
R732.35
+26.5%
18.8%R1,028.28R560.88n/a13
May ’25R554.00
R747.86
+35.0%
19.7%R1,038.59R566.50n/a13
Apr ’25R577.13
R760.68
+31.8%
19.7%R1,058.96R577.62n/a13
Mar ’25R566.00
R755.54
+33.5%
19.1%R1,050.88R573.21n/a14
Feb ’25R552.56
R745.10
+34.8%
18.9%R1,050.27R572.87n/a13
Jan ’25R541.51
R747.46
+38.0%
17.8%R1,014.12R542.43n/a15
Dec ’24R588.30
R830.68
+41.2%
15.4%R1,113.57R651.56n/a15
Nov ’24R561.85
R815.30
+45.1%
15.0%R1,088.82R637.08R615.6315
Oct ’24R593.50
R827.20
+39.4%
14.9%R1,106.81R647.60R634.2015
Sep ’24R618.20
R846.25
+36.9%
14.6%R1,124.54R657.98R660.1016
Aug ’24R607.43
R812.09
+33.7%
14.4%R1,073.46R628.09R646.2516
Jul ’24R626.00
R841.14
+34.4%
13.8%R1,100.28R643.78R565.4516
Jun ’24R630.96
R921.08
+46.0%
11.5%R1,148.11R683.98R579.0016
May ’24R670.83
R860.44
+28.3%
9.0%R1,060.84R699.71R554.0017
Apr ’24R625.69
R859.00
+37.3%
8.7%R1,054.20R695.32R577.1317
Mar ’24R686.89
R847.85
+23.4%
7.3%R1,034.21R770.16R566.0018
Feb ’24R664.05
R838.09
+26.2%
7.7%R990.87R737.88R552.5618
Jan ’24R674.10
R860.78
+27.7%
8.4%R1,024.81R747.26R541.5118
Dec ’23R734.02
R869.65
+18.5%
8.4%R1,033.59R753.66R588.3018
Nov ’23R723.30
R860.12
+18.9%
9.2%R1,002.28R730.83R561.8518

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

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