 Welcome to the channel. This is reliable Rudy in this video We're gonna move on from our Disney series, and we're gonna focus on BTI British American tobacco We found this in the viewer request for the everything money software right here. I'm sure it's way up here now But to touch base on that let's see if everything money has made a video on it It doesn't look like they have Yeah, this is back to August 8th. Yeah, it doesn't look like they have so They did not fill that viewer request, so I'm going to go ahead and do that for those multiple people that requested BTI I am looking to Make a follow-up video on Disney in the future. I don't know when I'll do that, but in a couple months down the road I'm sure I will touch back in base with Disney so if you are like that set of videos, I am going to do a follow-up and update that set of videos But before we get into this video in particular, I'm not a licensed financial advisor Everything in this video contains only my opinion as for entertainment purposes only I have no individual holding in BTI Unless it is in my VT Vanguard Total World Stock Market Index Fund or maybe VXUS Total International Stock Market Index Fund But nonetheless, I have nothing to gain nothing to lose just state my opinion here And we're gonna focus on the financial statements of BTI so going into this market cap 94 billion Pretty so they are profitable net income year-to-date 8 billion 30 billion in revenue little disconnects from our five-year PE current PE at 11.7 Profit margins year-to-date 26% extremely profitable. I love that But there is a big disconnect right here with my five-year profit margins So we are going to look into that a little bit year-to-date gross profit margins 82.9% Wow, that is extremely good profit margins right there are gross profit margins Price of sales 3.1 so for every three dollars and ten cents. I put into investing into this company They generate one dollar in revenue, but matching that up with these profit margins and gross margins That's pretty attractive to say the least Free cash flow year-to-date 10 billion and 10.61 billion in free cash flow year-to-date I love that and right in line with their five-year average. They do pay dividend 6.3% dividend Wow that is a that is an attractive dividend alone and Dividends paid 5.8 billion the free cash flow year-to-date easily covers that dividend So I am very attracted in this already off first glance They have return on assets and equity they 7.2% year-to-date return on invested capital It's a little bit below my 9% that everything money is looking for But nonetheless they are getting return on their invested capital and five-year average of 6.4 right in line Yeah, so let's look down here. Let's zoom in on this. I'll zoom in so you guys can see this a little bit better Following the acquisition of Reynolds, okay, so they made an acquisition I'm gonna want to make sure I touch base on the acquisitions if I forget to do that I will make sure I I touch base on the acquisitions right there British American tobacco Neck and neck with Philip Morris International for the largest listed global tobacco company. Okay, so it's a tobacco company Here is a list of some of their brands. Okay So very interesting stuff right there, let's go to the income statement and see what we're dealing with here So revenue I can see pretty consistent revenue. There is a lot. Oh, whoa. Whoa hold on. This is 2008 Why am I looking at 2,000? Yeah, they had 30 billion in revenue. What's going on here? Let's go the annual. Okay. Okay, so international companies sometimes with the everything money software The four quarter when I adjust it for their last four quarters, they're not getting the quarterly Statements put into this so we are going to focus on the annual right here So I'm not gonna have if they've posted to earnings reports this year. I'm gonna be missing out on two Quarters of financial data, but nonetheless, we're still going to go over the financials Up until 2021 that is a little bit scary because 2021 was a crazy year with all-time low interest rates and stimulus checks a lot of people had money But nonetheless, we're still gonna go over this now cost of goods sold right in line I don't see any large increases, but I'm sure and they're 2022 their cost of goods sold probably higher So I'm gonna want to touch base on that probably in a the next video or the video after I'm not sure But we are gonna touch base with that What else do I need to see net income? Okay. Whoa, whoa, whoa 44 in 2017 44 billion in net income There's got to be something to do with an acquisition right in there So we are definitely gonna go look at the acquisitions and see something there, but nonetheless, I would expect Pretty consistent if we take out the year of 2017 Pretty consistent revenue right here and growing a pretty decent pace. So I'm very attracted right there I don't see nothing really out of the ordinary except for this 2017 year with 44 billion. We definitely got to check that out So down to the shares Now I can see following that 2017 year they Pretty consistent 2017 they had the issue share so I'm guessing that the issue shares for this acquisition and probably had the issue more shares following that For the acquisition is what I would assume But now staying right in line So nothing alarming in terms of the last four years with shared allusion I like that and their dividends right in line big increase right here and the dividends But then they had to cut it a little bit. I'm sure for the acquisition But staying right in line with the dividends paid are per share So it looks like a pretty consistent dividend so 6.3% if that's accurate that is going to be attractive alone Especially with the payout ratio right around that 50% so pretty interesting there Well, yeah, let's go look at the cash flow statements. Okay, we're on annual Yeah, that 2017 year let's go look at the acquisition. Okay, so they made a Now remember they're 30 30 billion in revenue. This is a small acquisition. They sold off a I'm sure a couple of brands Sold off part of their department a little bit not much only 46 million couple other small. Oh, yep. Yep. Yep 2017 Already called it out knew that this was going to be a big acquisition right here 20 billion acquisition now I'm gonna want to Focus on 2017. I'm sure that the stock price Probably took a took a dump off of 2017 following this but since then I'm sure Actually, I'm not gonna say I'm sure but we're definitely going to look into this 2017 year nonetheless But following that pretty consistent free cash flow following those years So the company is profitable extremely profitable. I'm very interested in that but we do have to look into 2017 see what's going on there In terms of debt We should go to return on best capital look at the debt, but we'll do that in the balance sheet here before we do that Yeah, look at this debt repayment They took on a lot issued issuance of debt right here 2017 the same acquisition year They issued 48 billion in debt Okay, a lot of time has passed since there and they've consistently been paying off debt and especially in 2020 Sorry, the headset went out right there, but in 2020 they Paid off 12 billion so that we're going to touch base on the debt, but they have been repurchasing capital stock Consistently I like when they're buying back shares Yeah, let's go check base on the balance sheet Okay, so total current assets around a quarterly again 2006. That's weird. I don't like how that it's like that Okay, so now we're on our end. Well, we got 2021 right here Current assets around 15 billion total assets a hundred and sixty two billion So if I was looking for a current ratio, I want to see their total long-term liabilities or their current liabilities Lower than this a hundred and sixty-two. Here's our liabilities Total current liability or total liabilities 82 billion. So about a 2.0 current ratio Is this company going out of business anytime soon? No, I'm not worried about that. That's a solid current ratio I like that and total long-term liabilities 64 billion so I want to see their five-year average free cash flow multiplied by five Be higher than long-term liabilities in terms of debt comfortability. Now. I'm sure with the acquisition in 2017 that They are probably a little bit higher in the debt because that was a big acquisition. Let's not forget that but Yeah, pretty good stuff right there. Let's just go check the eight pillars tab and Okay, so they've been over the last five years. This is at in that five years It's adding in the shares outstanding that they diluted for post acquisition But going back to the income statement. We can see right here the last four years Pretty consistent. I'm not worried about that that share dilution right there because here was that big increase in shares from 2017 am I worried about them diluting shares going into the future? As of right now, I'm not worried about this 12% This is misleading 100% and long-term liabilities divided by five-year average free cash flow I'm not sure how much of that 2017 year. Let's go back to the free cash flow real quick and look at their free cash Let's see if that 2017 year was okay, so The 2017 year isn't too misleading on the free cash flow So I do like their five-year average free cash flow and consistently following that Been bringing in tons of free cash flow. So I like that number So a little bit still a little bit higher in the debt But if you look at their debt repayment consistently paying off that debt Am I going to be worried about the debt moving forward? So it's a little bit higher But nonetheless, I'm not as worried about this red check mark return on invested capital, you know a little bit lower But we can work with that Net income growth decreasing But now not too much They're five-year average. So this is net income growth from five-year average if we go back to the income statement Here is our 2017 year 44 billion in net income the year they made that acquisition This is misleading their five-year numbers So I'm not worried about that check mark that red check either because following that Consistent net income and growing so they're actually growing their net income So is it a red check mark or is it something that is actually a positive? I look at it as a positive because they're growing their their net income this Misleading their five-year numbers 100% no question about that Yeah, this is pretty attractive. I'm not surprised that people were requesting multiple people requesting this in the everything money chat That is going to wrap up this video. I'm going I'm very intrigued in making fall our more videos on BTI Very interesting stuff right here. I hope you guys enjoyed my breakdown of the financial statements, but we definitely got to go check Yeah, let's just go to return on Vesta capital real quick actually and the look at BTI and Look at that debt directly so Where's their debt Man, of course, I just cannot find it Long-term debt right here. So let's look at that 2017 year. Boom. Oh, man Look at that huge issuance of debt right there, but now look they've been consistently paying off that debt Am I as worried about the debt? You know, it's still a little bit higher but they've been growing as a company all in all and Are they gonna get to levels where we're more comfortable with that debt? You know, it's possible I don't have a crystal ball, but for the most part I liked everything that we've seen in terms of the financials I look forward to making our part to Where we might see if we can find the financial data for their last two quarters But if we're not able to do that, we will be able to work around it So maybe evaluation will dive into the stock analyzer tool for this company and following that we'll be going into the chart Yeah, I hope you guys liked the content a little bit longer, but yeah really good information I thought and we'll see you guys on the next videos