UK 00:35 Friday, 6 November 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
As a shareholder in Imperial Brands (IMB) where the argument is the similar I have some sympathy. I like getting a dividend into my SIPP as it covers my costs and paying a regular dividend is a good discipline for a company. However, is there a case for scrapping the payout altogether? For a stock yielding almost 10% that would be a shock. But asset manager Tidefall Asset Management makes a good case. It has written to BAT Industries (BATS) as you can see below:
A few weeks ago Imperial Brands (IMB) gave a corporate update which was positively received by the market. However, despite “reiteration of FY23 delivery in line with guidance”, today's update from larger peer British American Tobacco (BATS) has not been taken so well, with the company's shares down over 5% as I write and trading at around a five-year low. What is going on?
I look forward to the trading update from British American Tobacco (BATS) in about 10 days' time, but this morning I read that “the London-based tobacco company BAT has called for ‘more stringent’ regulations on vaping, including a licensing regime similar to alcohol and cigarettes”. What is going on?
It is a busy world out there, but I will leave all the excitable happenings at NatWest (NWG) to the real experts out there, and talk about some more sensibly managed FTSE 100 corporate names. First up, is British American Tobacco (BATS), which announced its own CEO shift a month or two back. I reckon this was driven by the need to actually start bringing the business deeper into the 2020s, especially as progressively it will be moving away from the world of cigarettes. But even I, as a complete non-smoker, have to acknowledge that it will take a bit of time, as despite a 30% revenue increase year-on-year in 2023, non-combustible offerings are still only 16.6% of the company’s overall sales. However, just like hybrid and/or electric cars, the user market share is only going up.
I will never personally smoke, vape or anything even mildly akin to such, but one of the main reasons my personal pension fund went up last year was down to the portfolio having a couple of global tobacco stocks. Swedish Match was purchased by another tobacco sector name at a decent price, whilst the FTSE 100 player Imperial Brands (IMB) did rather well, both from a dividend payment and a share price appreciation perspective. I shared with you earlier this year that north of a twenty quid share price there I was going to sell a good chunk of my shares, and I have done that. And, whilst the dividends continue to flow, the share price of Imperial Brands is back to a level last seen just over a year ago, which seems potentially a little bit harsh. Meanwhile, British American Tobacco (BATS) shares have performed even more badly. So what does its half-year trading update out this morning say?
As I write the shares of British American Tobacco (BATS) are down below a 3000p share price today, meaning year-to-date the cigarette and more name is down over 10%. And yet, back in the COVID-19 peak crisis and then investment excitement bounceback moments in 2021, the stock was back at 2500p. And we have not even discussed the over 7% dividend yield. What is going on at the multinational tobacco and other nicotine forms company?
In the world of investing, one must know when to quit. Whilst it is, I hope, many years before I no longer manage my money, one shouldn't expect to own their favourite stock today, forever. After all, it is not just that the world changes (because obviously, it does), but any share can become fundamentally fully-valued; that is when to move on.
For a non-smoker I undoubtedly do comment about the world’s leading tobacco names far too much. As an investor though there have been opportunities in the names over recent years, initially in terms of dividends but more recently via total return levels. It is certainly no disgrace to see Imperial Tobacco (IMB) shares up c. 10% year-to-date, whilst shares in British American Tobacco (BATS) are up nicely over 15%. Smoking! So where do us investors go from here on the names?
It is an exciting day at many levels, even if ‘the prime minister said it was too early to draw conclusions on the characteristics of Omicron but early indications were that it is more transmissible than Delta’. I see the FTSE 100 is within about 1% of its 2021 high, whilst the CAC 40 in France is even closer – and I won’t bore you with the observation about how close the S&P 500 in the US is to its goodness knows how many new highs this year. It is certainly all good fun for a certain type of investor.
