OVERVIEW OF BRITISH AMERICAN TOBACCO
📊 British American Tobacco originated in 1902 as a joint venture of the American Tobacco Company and the Uk-based Imperial Tobacco Company Ltd. The move was made in order to market British tobacco products in the US and vice versa. BAT became independent of the American Tobacco Company in 1911 and later began to quickly expand with the growing demand for cigarettes during World War I. From this position it went on to market cigarettes globally with an especially strong presence in China, as consumers there began to buy more cigarettes during the 1920s.
📊 In 1927 BAT regained its position in the American market when it acquired the Brown & Williamson Tobacco Corporation, which had grown to become one of the largest cigarette manufacturers in the US with such brands as Kool and Viceroy.
📊 Today, British American Tobacco is one of the top 5 tobacco companies in the world, controlling over 11% of the market with popular cigarette brands like Palmal, Kent, Lucky Strike, Dunhill, Kool, Benson and Hedges, Peter Stuyvesant and Rothmans. The group enjoys a wide global reach, with over 667 billion cigarettes sold in 2014 alone in markets across the Americas, Western Europe, Asia Pacific, Eastern Europe, Africa and the Middle East.
📊 BAT’s headquarters are in London, and the group has global operations in more than 80 countries, with 9 of its 44 factories located in Africa. As such, it employs more than 50 000 people worldwide with its products available in over 200 markets. The company has a primary listing on the London Stock Exchange while, having operated in South Africa for over 100 years, it has a secondary listing on the Johannesburg Stock Exchange (JSE) where it currently trades under the stock symbol -BTI.
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BRITISH AMERICAN TOBACCO PERFORMANCE
- British American Tobacco has a wide product portfolio with high production rates, its Heidelburg factory alone, the eighth largest BAT factory in the world, producing more than 27 billion cigarettes a year for both its local and export markets.
- BAT will continue to command its position as one of the global leaders in the tobacco industry, bolstered by its wide geographical scope that allows it to mitigate certain market challenges in the industry. BAT has been able to maintain its position and sustain positive growth forecasts due to its presence in both developed and emerging markets.
- Declining demand in developed regions coupled with stricter tobacco regulations have been mitigated by growing cigarette sales in emerging markets, where sustained volumes of growth have been predicted. Therefore, BAT has made it part of its growth strategy to focus on emerging markets while adding value to its portfolio by developing a widened product range in order to introduce Next Generation Products to the market.
BRITISH AMERICAN TOBACCO INVESTOR TIPS
- British American Tobacco enjoys thriving share prices on the JSE, with data from the live online stock charts reflecting record share price levels.
- The company’s global market position as well as its intensive development of Next Generation Products means that investors who choose to purchase BAT shares will enjoy fantastic dividend yields, paid quarterly to investors who buy them on the JSE.
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Before buying any stock or share one has to consider a few factors.
STEP 1: PROPER RESEARCH IS ESSENTIAL
Upon deciding you want to buy BRITISH AMERICAN TOBACCO Stocks / Shares, it is critical for the serious investor to do proper research into the said company. Its values should align with those of the investor’s current portfolio. An investor needs to familiarise himself with the basics and history of the company, as well as its leadership and performance in the market. Its company reports should also be scrutinized.
Consultation with a brokerage firm can also assist in determining whether investing in a specific company will complement the investor’s current portfolio. The investment “risk ladder”, which identifies asset classes based on their relative riskiness, is another useful tool when determining which company’s stock / share is the best to buy.
STEP 2: CALCULATE THE AMOUNT OF INVESTMENT IN BRITISH AMERICAN TOBACCO STOCKS / SHARES
It is important for an investor to monitor his total investment in stock in order to keep his portfolio aligned to his investment strategy. The overall value of his holdings will change with the fluctuation in stock prices, which can throw his portfolio off balance. To determine the amount to invest, multiply the number of shares of each stock by its current market price to determine the total investment in that specific stock. For example, if you own 100 shares of a $5 stock, multiply 100 by $5 to get $500.
STEP 3: DECIDE ON THE STOCK / SHARE ORDER TYPE
Investors can choose from a market order, a limit order, a stop order (also referred to as a stop-loss order) or a buy/sell stop order. It is important to familiarise yourself with each type’s pros and cons before deciding which one will suit your current stock profile best. An investor should be guided in this choice by his investment objective.
STEP 4: OPEN A BROKERAGE ACCOUNT
A brokerage account – also known as taxable investment account – is similar to a retirement account, but more flexible. Where a retirement account has limitations on the amount of money that can be contributed annually, and restrictions on when funds can be withdrawn, a brokerage account is more flexible. The latter has no income or contribution limit and the investor can withdraw his money at any given time. This flexibility, together with its potential investment gains, makes a brokerage account more attractive to serious investors. Brokerage accounts are ideal for goals or savings that are further than five years away, but closer than retirement. It can also supplement an investor’s emergency savings.
STEP 5: COMMIT AND PURCHASE BRITISH AMERICAN TOBACCO STOCKS / SHARES
Lastly, commit to the stock. Pro Tip: Monitor the value of your stock to ensure you have a growing stock value and dividend pay-out. Regularly check the share price online to ensure your investment delivers a positive return on investment. You are now a proud owner of BRITISH AMERICAN TOBACCO stocks / shares.
5 Questions to ask yourself before purchasing any stocks or shares.
- Is it the best time to buy this stock / share?
- Should I buy BRITISH AMERICAN TOBACCO stocks / shares in the current economic climate?
- Can I afford to buy this stock / share?
- What is the forecast of the stock / share growth?
- What is the current price per earning ration on the stock / share?
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