News Flash: Analysts Just Made A Notable Upgrade To Their British American Tobacco (Malaysia) Berhad (KLSE:BAT) Forecasts

British American Tobacco (Malaysia) Berhad (KLSE:BAT) shareholders will have a reason to smile today, with the covering analyst making substantial upgrades to this year's statutory forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. British American Tobacco (Malaysia) Berhad has also found favour with investors, with the stock up a whopping 35% to RM6.11 over the past week. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

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Following the latest upgrade, the current consensus, from the single analyst covering British American Tobacco (Malaysia) Berhad, is for revenues of RM2.0b in 2026, which would reflect an uncomfortable 8.0% reduction in British American Tobacco (Malaysia) Berhad's sales over the past 12 months. Statutory earnings per share are anticipated to dip 5.4% to RM0.67 in the same period. Prior to this update, the analyst had been forecasting revenues of RM1.6b and earnings per share (EPS) of RM0.37 in 2026. There has definitely been an improvement in perception recently, with the analyst substantially increasing both their earnings and revenue estimates.

See our latest analysis for British American Tobacco (Malaysia) Berhad

With these upgrades, we're not surprised to see that the analyst has lifted their price target 71% to RM6.51 per share.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the British American Tobacco (Malaysia) Berhad's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 8.0% by the end of 2026. This indicates a significant reduction from annual growth of 0.9% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.5% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - British American Tobacco (Malaysia) Berhad is expected to lag the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that the analyst upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, British American Tobacco (Malaysia) Berhad could be worth investigating further.

The covering analyst is clearly in love with British American Tobacco (Malaysia) Berhad at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as its declining profit margins. For more information, you can click through to our platform to learn more about this and the 3 other warning signs we've identified .

You can also see our analysis of British American Tobacco (Malaysia) Berhad's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.