Dividend Comparison - British American Tobacco offers a higher dividend yield of 8.4% compared to Kraft Heinz's 5.5% [2] - British American Tobacco has a consistent track record of increasing its quarterly dividend since 2018, while Kraft Heinz cut its dividend in 2019 and has not increased it since [3] - For investors focused solely on dividends, British American Tobacco is the clear choice [4] Business Challenges - Both companies face significant business challenges, which contribute to their high dividend yields [5] - Kraft Heinz is struggling with its brand-focused strategy, as the brands it prioritizes are underperforming compared to non-prioritized brands [7] - British American Tobacco is experiencing a long-term decline in cigarette volumes, with production dropping from 700 billion in 2018 to 555 billion in 2023 [9] - British American Tobacco has been offsetting volume declines with price increases, but this strategy may not be sustainable in the long term [10] - The company has changed its accounting treatment for U S cigarette brands, suggesting it expects them to become worthless in about 30 years [11] Investment Outlook - Kraft Heinz appears to have a better long-term outlook due to the essential nature of its food products and its strong brand portfolio [14] - British American Tobacco faces deeper structural issues, as its core product category is in decline and its future is uncertain [9][11] - While neither company is performing well from a business perspective, Kraft Heinz seems more likely to recover compared to British American Tobacco [13][14]
Best Stock to Buy Right Now: British American Tobacco vs. Kraft Heinz
BAT(BTI) The Motley Fool·2025-01-18 09:52