British American Tobacco shares plunge as US headwinds blow

British American Tobacco (LSE: BATS) shares have tumbled 7% today to their lowest since 2011 as the tobacco titan lowered its 2023 guidance amid US economic woes.

BAT now expects full-year organic revenue growth at the bottom of its 3-5% range, citing a tough US macro backdrop and rampant illicit trade. But it still predicts mid-single digit rises in adjusted EPS.

Though bullish on emerging smokeless products, BAT said it will book a £25bn impairment charge, mainly on acquired US cigarette brands, as it eyes a 50% revenue share from non-combustibles by 2035.

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CEO Tadeu Marroco said BAT remains committed to becoming a predominantly “smokeless” business. However, with only 10% of the world’s 1bn smokers currently using alternatives, BAT still relies heavily on cigarettes.

Today’s plunge leaves BAT nursing a 31% share price loss this year. Investors are blowing smoke over its hazy US outlook and shifting business mix.