One can literally feel how much you hate Altria. Do you know that BAT also makes an extremely high proportion of its sales in the USA? BAT is active worldwide, but more than 54% of its operating profit is still linked to the USA. But the argument that only Altria is strongly dependent on the USA is not correct. BAT also has to score in the USA. No other region is nearly as profitable. Debt situation: British American Tobacco had a net debt of $40.7 billion in the middle of 2022 = $50.1 billion Altria has a debt of $26.291 billion on the liabilities side. - $2.483 billion = $23.808 billion net debt But Altria holds 9.34% in beer giant Anheuser Bush: current market value = US$11.3 billion Altria could throw these on the market at any time or wait for a better time. Anheuser shares are also very favorably valued, which would give Altria a net debt of just US$12.5 billion. (So Altria still has one or two trump cards in its hand here. Despite the failures with Juul and Co. Altria still has enormous room for maneuver in the balance sheet. If Altria were to sell the Anheuser shares today and bring the net debt to 3* Ebitda ( = US $ 35.41 billion), then almost 30% of the outstanding Altria shares could be bought back.
What I am getting at is that if you consider that Altria still holds a block of shares in AB Inbev (Anheuser) and factor this into the debt situation, then Altria still has a huge amount of firepower up its sleeve for such a stable business. What the management does with it we do not know... One thing to consider is that if Anheuser shares were to rise in valuation (the stock itself trades below 10*Ebitda), then the debt could even dissolve altogether.
What I am getting at is that if you consider that Altria still holds a block of shares in AB Inbev (Anheuser) and factor this into the debt situation, then Altria still has a huge amount of firepower up its sleeve for such a stable business. What the management does with it we do not know... One thing to consider is that if Anheuser shares were to rise in valuation (the stock itself trades below 10*Ebitda), then the debt could even dissolve altogether.
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@MrCumEx Darling if I really hated Altria - would I have them in my portfolio?đ I have only openly referred to individual points of criticism and regularly invite people here for qualified comments. Yours is one of those - except for the insinuation.Still, thanks for your comment. Very interesting points.đ
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âą@BASS-T gladly. I just don't think you've treated Altria fairly. But praising BAT to the skies....
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