British American Tobacco stock gets Goldman growth upgrade

Published on 11/09/2026 at 10:10 | Editorial responsibility: Rafael Müller, Editor-in-Chief AD HOC NEWS

British American Tobacco stock drew a Goldman Sachs upgrade on a clearer growth path. A December trading update is the next test.

Goldman sees growth inflection

Goldman Sachs raised its rating on British American Tobacco to Buy and lifted its 12-month price target to 5,600 pence.
The bank expects organic sales growth of about 4% in 2027 and 2028, supported by New Categories and resilient combustible sales.
BAT's December 2026 trading update is the next major test for the improved growth thesis.

BAT, GB0002875804, Illustration mit AI erstellt.

Goldman Sachs upgraded British American Tobacco to Buy from Neutral on Monday, November 2, citing a clearer path toward sustained organic revenue growth. The assessment, reported by Investing.com via Yahoo Finance, gives the tobacco group a more constructive medium-term outlook while retaining regulatory and execution risks.

British American Tobacco stock traded at 54.63 euros on Lang & Schwarz at 10:03 CET on Monday, November 9, 2026. Investors can follow the real-time quote of British American Tobacco stock.

New Categories drive the case

Goldman raised its 12-month price target to 5,600 pence from 5,200 pence. The brokerage said the improved growth outlook could justify a valuation of about 13.5 times expected 2027 earnings, compared with BAT's reported multiple of 12 times. The target also reflected a dividend yield close to 6%.

The bank expects organic sales growth to accelerate after four years of low-single-digit expansion that remained below management's target. Its forecast calls for growth of about 4% in both 2027 and 2028, helped by resilient combustible sales and mid-teens growth in New Categories. The United States remains central to the thesis because it accounts for more than 60% of BAT's operating profit.

Product execution is a key part of the argument. Goldman said the Velo Max nicotine pouch, launched in September, had reached 44,000 outlets by October and could add another 55,000 outlets by January 2027. Vuse vapour volumes were up 20% through August in US states with observable enforcement, nearly twice the industry's growth rate, according to the analysis.

Risks remain in the outlook

Goldman expects the Asia-Pacific, Middle East and Africa region to return to growth from 2027 as the effects of weakness in Bangladesh and Australia become less significant. It forecasts medium-term operating profit growth of 5% to 6%, while estimating average earnings-per-share growth of 9% over five years as debt reduction and faster share buybacks support returns.

The forecasts are not uniformly positive. Goldman cut its earnings-per-share estimates for 2027 and 2028 by 0.4% and 1.3%, respectively, reflecting revised industry assumptions and exchange-rate movements. It also identified regulation, US FDA enforcement and authorization delays as risks to the New Categories strategy.

The December 2026 trading update is the next scheduled catalyst identified in the analysis. Goldman expects it to show stronger second-half momentum, making the update important for judging whether the projected growth acceleration is beginning to appear in the group's operating performance.