# British American Tobacco p.l.c. (BATS.L) fundamentals

Data as of 2026-09-08. LSE, United Kingdom. Sector: Consumer Defensive / Tobacco. Price 4115p, market value 88.6 billionp.

## Valuation
- **P/E (trailing): 14.1×** (5-yr avg 1341.0×, 3-yr avg 1661.4×). British American Tobacco p.l.c. trades at 14.1× trailing earnings, well below its own five-year average of 1341.0×: cheap by its own standards. The Consumer Defensive median in the September 2026 study was 20.1×. Forward P/E is 10.6×, lower than trailing, so analysts expect earnings to grow.
- **PEG: 0.07**. A PEG of 0.07 means the P/E is low relative to expected earnings growth: the market is not paying much for that growth.
- **Price / sales: 1.7×**. Each dollar of revenue is priced at 1.7×.
- **Price / book: 1.9×**. The shares trade at 1.9× book value; book value is a meaningful part of the valuation.
- **EV / EBITDA: 7.0×**. Enterprise value is 7.0× operating earnings before depreciation, the multiple that ignores how the company is financed; below 8× is inexpensive for most sectors.
- **Free-cash-flow yield: 15.0%** (5-yr avg 0.1%). Free cash flow equals 15.0% of the market value, above its five-year average of 0.1%, so the shares are cheaper on cash than they have usually been. Above 5% is generally attractive.
- **Earnings yield: 7.1%**. The inverse of the P/E: 7.1% of the price is earned each year.

## Profitability
- **Gross margin: 68.1%**. British American Tobacco p.l.c. keeps 68.1% of revenue after the direct cost of what it sells, the kind of margin that comes with software, brands or pricing power.
- **Operating margin: 27.0%**. 27.0% of revenue is left after running the business, an exceptional level.
- **Net margin: 30.3%**. 30.3% of each dollar of sales reaches the bottom line.
- **Return on equity: 16.2%**. 16.2% on shareholders' equity is solid.
- **Return on invested capital: 14.2%**. Return on all capital, debt included, is 14.2%.
- **Return on assets: 9.9%**. Each dollar of assets produces 9.9% of profit.

## Growth
- **Revenue growth (1 yr): -1.0%** (3-yr -2.5%/yr, 5-yr -0.1%/yr). Revenue fell 1.0% over the last year, against -0.1% a year compounded over five years: growth is slowing.
- **EPS growth (1 yr): 156.6%** (3-yr 6.1%/yr, 5-yr 4.6%/yr). Earnings per share rose 156.6%, faster than revenue, so margins expanded or the share count shrank.
- **Free-cash-flow growth (3 yr): -23.8%/yr**. Free cash flow has compounded at -23.8% a year over three years, lagging earnings: check whether profits are turning into cash.

## Financial health
- **Debt to equity: 0.75**. Debt is 0.75 times equity, moderate leverage.
- **Net debt / EBITDA: 1.9×**. It would take 1.9 years of operating earnings to repay net borrowings, within the comfortable range.
- **Interest coverage: 3.6×**. Operating profit covers interest 3.6× over, a safe margin.
- **Current ratio: 0.87** (quick 0.57). Current liabilities exceed current assets, so the company depends on ongoing cash generation or refinancing to pay the next year's bills.
- **Altman Z-score: 2.00**. A Z-score of 2.00 is in the grey zone; not distressed, not clearly safe.
- **Piotroski F-score: 7/9**. 7 of 9 fundamental checks pass: strong and improving financials.

## Dividends
- **Dividend yield: 5.98%** (2p per share, trailing). British American Tobacco p.l.c. yields 5.98%, an income-level yield.
- **Payout ratio: 67%** (79% of free cash flow). 67% of earnings goes out as dividends, leaving room to keep raising it.
- **Consecutive years of increases: 7**. 7 straight years of increases.
- **Dividend growth (5 yr): 2.7%/yr** (1-yr 2.0%). The dividend has grown 2.7% a year over five years.
- **Shareholder yield: 8.7%**. Dividends plus net buybacks return 8.7% of the market value a year.

## Analyst view
- **Analyst consensus: buy** (13 analysts). 13 analysts cover British American Tobacco p.l.c.; the consensus is buy, with an average price target of 5146p (+25% from the current price). Analyst opinion is shown for context; it is not part of the Fundamental Score.

## Price and momentum
- **Total return (1 yr): -0.9%** (YTD -2.8%, 3-mo -9.0%). The shares are down 0.9% over twelve months including dividends.
- **From 52-week high: -23.3%** (11.9% above the low). Trading 23% below its 52-week high.
- **200-day average: below**. The price sits below its 200-day moving average, the usual definition of a downtrend.
- **RSI (14-day): 40**. An RSI of 40 is neutral.
- **Beta (1 yr): 0.84** (volatility 25%). Beta of 0.84 against the FTSE All-Share: the shares move roughly with the market.

Live score and charts: https://foliofundamentals.com/analyzer?s=BATS.L · Page: https://foliofundamentals.com/stocks/bats.l

Not investment advice.