Unum Capital: British American Tobacco - A Shift In Trend

Unum Capital: British American Tobacco - A Shift In Trend

Share Name | British American Tobacco (BTI)
Exchange | JSE

Trade Thesis | In a market that has made new all-time highs, tobacco giant BTI has lagged substantially, becoming a serial under-performer, with it’s market value being slashed by concerns over

– Regulation
– Volumes: a long term concern over decline in it’s product usage, driven by
– A healthier consumer
– A shift to new-age products

While the sector conditions remain uncertain, I have noticed a medium term technical shift taking place where the widely-watched 200-day moving average is slowly starting to turn higher after being in a downward trend for 20 months. Currently, the price is consolidating by trading in a sideways channel and nearing a potential break-up. It should also be noted that the weekly RSI is starting to regain bull territory, recently entering the +50 zone.
With price starting to stabilize, medium term traders have opportunity to accumulate the share within an equity portfolio.

Trading Plan |

Accumulate BTI at current levels 53512c or better
Use a stop-loss of 50500c to protect capital
Take profit at or near 61000c (Medium To Long Term Buy)

Selected Fundamental Metrics | 
 
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Please chat to the Unum Capital Trading Desk to take advantage of any trading opportunities.
All the best,
Lester Davids
Unum Capital Trading Desk Analyst
e-mail: clientservices@unum.co.za
Tel: 011 384 2923

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