BAT(US:BTI) Zhi Tong Cai Jing·2025-12-09 12:24Core Viewpoint - British American Tobacco (BTI.US) has provided a cautious earnings outlook for 2026, primarily due to regulatory pressures and intense competition in the U.S. e-cigarette market, which offsets strong growth in other areas of its business [1][2] Group 1: Earnings Guidance - The company expects its 2026 revenue growth to be at the lower end of its mid-term target range of 3%-5%, with adjusted operating profit growth anticipated at 4%-6% [2] - For 2025, the company forecasts revenue and adjusted operating profit growth of approximately 2% [2][3] - The stock buyback plan has been increased from £1.1 billion to £1.3 billion (approximately $1.7 billion) [1] Group 2: Market Challenges - The U.S. e-cigarette market, valued at $22 billion, is facing significant challenges from a surge of non-compliant products, impacting profitability [1] - The CEO noted that about 70% of the U.S. e-cigarette market remains unregulated, creating uncertainty about when it will become a growth driver [1] - Additional pressures include stricter tobacco regulations in Australia and ongoing investments in emerging product categories, which may suppress profit growth [2] Group 3: Analyst Insights - Analysts have pointed out that the recent earnings guidance may not align with market expectations, despite the stock's strong performance, which has seen a 50% increase year-to-date [2] - The company has provided conservative growth guidance for the fourth consecutive year, leading some analysts to find competitors like Imperial Brands (IMBBY.US) more attractive in terms of valuation and growth potential [2]