London, June 24, 2026, 11:14 BST
British American Tobacco shares (BATS:LON) traded higher for the third straight day on Wednesday, gaining 0.9% to 4,628 pence by 1101 BST. The stock added 2.5% on Monday and 3.1% Tuesday, for a 6.7% jump over three sessions. FTSE 100 held flat. Trading volume on Tuesday was 2.7 million, trailing the 50-day average of 4.5 million.
The rally left the shares trading 2.1% over the average price BAT paid in its most recent buyback. BAT picked up 494,286 shares from June 15 to June 18, spending about £22.4 million, with an average price of 4,531.7 pence, according to daily data. The company is set to cancel the shares.
BAT’s set annual dividend of 245.04 pence per share means scrapping these shares cuts about £1.21 million from its yearly dividend obligation, if the per-share payout stays the same. The dividend tied to the bought-back shares comes to 5.4% of what BAT paid for them on average.
BAT’s voting share count dropped by 11.24 million, or 0.52%, since January 30, to 2.1659 billion after its latest share cancellation. That amounts to about £27.5 million less in annual dividends, if the same dividend rate stays. The figure isn’t a straight total of shares bought back, since it includes any shares issued or reissued from treasury.
BAT is planning a £1.3 billion buyback for 2026, targeting leverage at 2.0 to 2.5 times net debt to adjusted operating earnings by the end of the year. Buying back the full amount at 4,531.7 pence would cut about 28.7 million shares, or 1.3% of current voting shares, and save around £70 million a year in dividend payments based on the set rate. The number of shares retired will depend on actual prices. Chief Executive Tadeu Marroco said full-year delivery “remains firmly on track.” BAT
The latest batch made up just 0.023% of voting shares and those buys wrapped up on June 18, so that by itself doesn’t explain the move this week. Imperial Brands added around 1.3% Wednesday, which shows the bid wasn’t just about BAT.
BAT raised its New Category revenue growth outlook to the mid-teens but left overall group guidance the same. The company expects a 2.5% drop in global cigarette volumes this year and says it has lost share for cigarettes in its seven biggest markets. Barclays analyst Pallav Mittal noted some investors were looking for a broader revenue upgrade. Marroco estimated the unlicensed U.S. vape market at £7 billion, saying: “The size of the prize is very high.” If product launches are slow or enforcement against illicit vapes stays weak, the investment story could end up leaning more on buybacks than on sales growth. Reuters
BAT will release its first-half results on July 30.
