LONDON, Jan 21, 2026, 08:48 GMT — Regular session
- BAT shares edged up 0.1% in early London trade, rebounding slightly from a 2.65% drop on Jan. 20
- Company disclosed it repurchased 160,365 shares in its latest buyback batch and plans to cancel them
- UK inflation figures sustain hopes for rate cuts ahead of next month’s data release
British American Tobacco (BATS.L) shares edged up 0.1% to 4,262 pence (£42.62) by 08:48 GMT Wednesday, clawing back some of the losses from Tuesday.
The modest bounce is notable since BAT is a major, dividend-focused player in the FTSE 100, known for its defensive stance. The stock slipped 2.65% on Tuesday, closing at £42.57 amid a broader market decline, and saw lighter trading volume than usual.
BAT announced on Wednesday that it repurchased 160,365 shares on Jan. 20 as part of its ongoing buyback program and intends to cancel them. The company paid a volume-weighted average price (VWAP) of 4,253.43 pence per share. Once cancelled, BAT will have roughly 2.18 billion shares outstanding, excluding treasury shares.
Traders were tracking key macro data as UK inflation climbed to 3.4% in December, driven by rising airfares and tobacco costs. Still, markets anticipate a slowdown soon. “Although the uptick is larger than expected, for now it’s a speed-bump,” noted Adam Deasy, economist at PwC. Reuters
In tobacco, Imperial Brands tapped John Rishton as its new chair, marking another development in a week packed with shareholder-return and governance news for the company.
BAT investors are keeping a close eye on cash flow and how the company divides it among dividends, buybacks, and debt repayment. Even routine buyback announcements can shake the stock early on, particularly following a steep drop the day before.
Stocks with hefty dividends often behave like a play on interest rates. If investors bet on falling rates, those steady payouts become more appealing; but when inflation heats up, the numbers don’t add up as well.
Still, the buyback won’t erase the key risks facing the sector: tougher regulation, rising excise taxes, and the risk that cigarette sales decline faster than prices can compensate. Margin pressure could also build if competition in newer nicotine products drives a more promotional market.
BAT’s full-year 2025 results arrive Feb. 12, marking the next major event. Investors will focus on guidance, cash-return strategies, and any signals on demand trends for both cigarettes and newer product lines.
