LONDON, March 24, 2026, 16:14 GMT
British American Tobacco shares edged up roughly 1.2% on Tuesday afternoon after the company logged another round of buybacks. The stock traded near 4,335.5 pence, clawing back a portion of the recent five-day, 4.4% drop.
This matters for BAT, which is banking on cash returns to prop up its stock as growth slows down. Back in December, the Lucky Strike and Dunhill maker flagged that its 2026 revenue will probably hit the bottom of its 3%-5% medium-term target, and it announced a £1.3 billion buyback for this year.
BAT has put up a 38.57% gain over the last year, according to Trading Economics data. That’s well ahead of the FTSE 100’s roughly 15% rise in the same stretch, keeping the company in the thick of London’s hunt for defensive dividend names.
BAT picked up 101,204 ordinary shares from Banco Santander on March 23, shelling out a volume-weighted average of 4,258.7007 pence per share, according to a Tuesday filing. The company plans to cancel these shares, which will bring the total number of ordinary shares in issue down to 2,172,899,092, not counting treasury stock.
But whether that backing sticks is tied closely to the fate of smoke-free products. Back in February, Chief Executive Tadeu Marroco said he was “extremely encouraged” by how Velo—BAT’s nicotine pouch—was stacking up in the U.S., snatching share from Zyn (Philip Morris) and Altria’s On! As of 2025, smoke-free products accounted for 18.2% of BAT’s sales, according to Reuters. Reuters
The rivalry is heating up. Back in February, Philip Morris flagged growing investor nerves over Zyn as BAT started to gain more ground in nicotine pouches. Even so, PMI kept its upbeat 2026 profit outlook. Jefferies analyst Andrei Andon-Ionita described PMI’s fresh targets as a “reassuring outlook,” but pointed out that BAT still looks positioned to grab more U.S. pouch market share. Reuters
Some brokers are still on edge. After BAT’s December update, Panmure Liberum’s Rae Maile called the outlook “not quite what the share price needed” following a rally, underscoring that buybacks might help keep shares stable but don’t fix weaker revenue trends. Reuters
Regulation and illicit trade remain the big risks here. Back in December, BAT estimated roughly 70% of the U.S. vape market hadn’t been brought under official oversight yet. Then in February, the company pointed to Australia and Bangladesh as problem spots. Interim finance chief Javed Iqbal told investors Australia’s impact would stretch into 2026, after revenue for Asia-Pacific, Middle East, and Africa dropped over 7% last year.
Investors aren’t in a rush to leave, not with BAT’s dividend yield hovering near 5.7%, according to Trading Economics. Tuesday’s move higher signals that the market remains on board with the payout and buyback, content to collect income as it waits to see whether Velo, Vuse, and the rest of BAT’s smoke-free lineup can actually deliver more meaningful growth.
