A.I.dvisor Flashing Bearish Signal for British American Tobacco (BTI)
Cigarette and e-cigarette manufacturer British American Tobacco (NYSE: BTI) dropped by over 50% during 2018 before rallying slightly in the past month. However, if Tickeron’s AI Prediction tool is accurate, the stock could be getting ready for another leg down.
The prediction model generated a bearish signal three days ago with an 84% confidence level. The signal calls for a decline of at least 4% over the coming month.
The daily chart shows a trend line connecting the highs from August, October, and November. The stock is challenging that trend line at this time, but the stock was in overbought territory based on the 10-day RSI and the daily stochastic readings. The stochastic readings just made a bearish crossover and the RSI just dropped out of overbought territory which would also suggest that a downturn is possible.
The fundamentals for BTI are a bit of a mixed picture. The earnings have been growing slowly while the sales have been growing at an above average pace. Earnings have averaged growth of 7% per year over the last three years while sales have grown at a rate of 14% over that same period. Earnings were up 5% in the most recent quarterly report while sales increased by 59%.
The company’s management efficiency measurements and profitability measures are also mixed. The return on equity is average at 15.9% while the profit margin is well above average at 39.3%.
BTI's RSI Indicator ascends from oversold territory
The RSI Oscillator for BTI moved out of oversold territory on April 17, 2024. This could be a sign that the stock is shifting from a downward trend to an upward trend. Traders may want to buy the stock or call options. The A.I.dvisor looked at 26 similar instances when the indicator left oversold territory. In of the 26 cases the stock moved higher. This puts the odds of a move higher at .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on April 24, 2024. You may want to consider a long position or call options on BTI as a result. In of 98 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for BTI just turned positive on April 23, 2024. Looking at past instances where BTI's MACD turned positive, the stock continued to rise in of 44 cases over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where BTI advanced for three days, in of 325 cases, the price rose further within the following month. The odds of a continued upward trend are .
BTI may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In of 212 cases where BTI Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The Stochastic Oscillator has been in the overbought zone for 2 days. Expect a price pull-back in the near future.
BTI moved below its 50-day moving average on April 24, 2024 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for BTI crossed bearishly below the 50-day moving average on April 15, 2024. This indicates that the trend has shifted lower and could be considered a sell signal. In of 21 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where BTI declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
Fundamental Analysis (Ratings)
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.002) is normal, around the industry mean (3.328). BTI has a moderately low P/E Ratio (0.000) as compared to the industry average of (12.468). BTI's Projected Growth (PEG Ratio) (3.149) is slightly lower than the industry average of (16.126). BTI has a moderately high Dividend Yield (0.099) as compared to the industry average of (0.064). P/S Ratio (1.929) is also within normal values, averaging (29.280).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. BTI’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. BTI’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 82, placing this stock better than average.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
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General Information
a retailer of tobacco related products
Industry Tobacco