not vested
European Stocks to Buy: British American Tobacco PLC (ADR) (BTI)
While any European outfit that borrows money as a normal course of business stands to gain from cheaper interest rates, British American Tobacco PLC (ADR) (BTI) is particularly well suited to enjoy the upside of banks being desperate to make loans.
The $106 billion company presently has £14.8 billion worth of debt that matures over the course of the next several years.
Not a lot of debt given the company’s size? True, but it is a lot of debt given the company’s operation.
BTI only did about £13.1 billion worth of business last year. Slightly lower interest would go a long way towards beefing up the bottom line.
This most recent drop in Europe’s lending rates may also finally be enough to prompt British American Tobacco to pull the trigger on the purchase of the remainder of Reynolds American, Inc. (RAI).
Such a deal could be a real boon for BTI, giving the struggling company the scale and reach it needs to thrive again.
Source: Investor Place