Citi has reiterated its "buy" rating on British American Tobacco ahead of the group's US investor day, arguing the focus will now shift from proving its move beyond cigarettes to making money from it.
The FTSE 100 group, whose brands include Vuse and Velo, holds a two-day capital markets day in the United States on 29 and 30 September.
The bank expects a message of continuity and evolution rather than a change of direction.
Since its last such event in 2024, Citi said BAT had delivered on most of its priorities, including making its smokeless products profitable, accelerating its US modern oral business, reviving its Vuse vaping brand and cutting debt.
The narrative should now pivot towards monetising that transition through durable earnings growth, cash generation and shareholder returns.
Citi expects management to reaffirm its medium-term targets of 3% to 5% organic sales growth, 4% to 6% profit growth, and more than £50 billion of cumulative free cash flow by 2030.
An uncertain US consumer backdrop, however, is likely to keep this year's performance at the lower end.
The bank sees scope for BAT to lift its Fit2Win cost savings target to £1 billion by 2030 and to commit to a rolling, or "evergreen", share buyback.
It singled out modern oral nicotine pouch brand Velo as the standout growth asset.
Heated tobacco, by contrast, remains a weaker spot for the group.
The upbeat note reflects growing investor confidence in BAT's shift towards smokeless products, after a difficult few years for the wider tobacco sector.
