BAT: First-Half 2024 Shaping Up Within Expectations; Shares Very Undervalued

Wide-moat British American Tobacco's pre-close first-half trading update provided few details but reaffirmed most of its previously issued guidance. The company continues to expect low-single-digit revenue and adjusted profit growth on an organic and constant currency basis for 2024, in line with our forecasts of 2% and 4%, respectively. Additionally, it expects performance to be weighted toward the back half of the year, especially for revenue from new categories. We maintain our GBX 3,900 per share and $49 per ADR fair value estimates and view shares as very undervalued.