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British American TobaccoCHIX:BATSL +0.34%71 Debt-to-EBITDA is 2.77 as of Dec. 2025, which is 24% below its 10-year median of 3.63. GuruFocus rates CHIX:BATSL with a GF Score™ of 71/100 and a GF Value™ of £27.87 (Significantly Overvalued). The stock has 4 warning signs investors should review. Among 35 Tobacco Products companies, British American Tobacco ranks worse than 68.57% on this metric.
Debt-to-EBITDA measures a company's ability to pay off its debt.
A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt. According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.
The historical rank and industry rank for British American Tobacco's Debt-to-EBITDA or its related term are showing as below:
CHIX:BATSl'
s Debt-to-EBITDA Range Over the Past 10 Years
Min: 1.57 Med: 3.63 Max: 4.5
Current: 2.5
During the past 13 years, the highest Debt-to-EBITDA Ratio of British American Tobacco was 4.50. The lowest was 1.57. And the median was 3.63.
CHIX:BATSl's Debt-to-EBITDA is ranked worse than 68.57% of 35
companies
in the Tobacco Products industry
Industry Median: 1.37
vs CHIX:BATSl: 2.50
British American Tobacco (CHIX:BATSl) Debt-to-EBITDA Explanation
A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt.
According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.
British American Tobacco Debt-to-EBITDA Related Terms
British American Tobacco Debt-to-EBITDA Historical Data
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
CHIX:BATSL vs PM, MO, TPB: Debt-to-EBITDA Comparison
For the Tobacco subindustry, British American Tobacco's Debt-to-EBITDA, along with its competitors' market caps and Debt-to-EBITDA data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
British American Tobacco Debt-to-EBITDA vs Tobacco Products Industry
For the Tobacco Products industry and Consumer Defensive sector, British American Tobacco's Debt-to-EBITDA distribution charts can be found below:
* The bar in red indicates where British American Tobacco's Debt-to-EBITDA falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual Debt-to-EBITDA, the EBITDA of the last fiscal year is used. In calculating the annualized quarterly data,
the EBITDA data used here is two times the quarterly (Dec. 2025) EBITDA data.
British American Tobacco (CHIX:BATSL) has a Debt-to-EBITDA of 2.77 as of Dec. 2025. Debt-to-EBITDA ratio represents the ratio of total debt to total earnings before interest, taxes, depreciation and amortization. View historical data on British American Tobacco. This is 24% below median its historical median of 3.63. Over the past decade, British American Tobacco's Debt-to-EBITDA has ranged from 1.57 to 4.50. According to the industry distribution chart, British American Tobacco ranks #24 out of 35 companies in the Tobacco Products industry, placing it in the top 68.6%.
Is British American Tobacco's Debt-to-EBITDA too high?
British American Tobacco's current Debt-to-EBITDA of 2.77 is 24% below median its 10-year median of 3.63. Over the past 10 years, this metric has ranged from a low of 1.57 to a high of 4.50. The Tobacco Products industry median Debt-to-EBITDA is 1.37. British American Tobacco's value of 2.77 is 102.2% above this industry median. Based on the distribution chart, British American Tobacco ranks #24 out of 35 companies in the Tobacco Products industry, which is below the industry midpoint. Overall, British American Tobacco has a GF Score™ of 71/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does British American Tobacco's Debt-to-EBITDA compare to PM and MO?
According to the Tobacco Products industry distribution chart, British American Tobacco ranks #24 out of 35 companies for Debt-to-EBITDA. This places British American Tobacco in the lower half of its industry. The industry median Debt-to-EBITDA is 1.37. British American Tobacco's value of 2.77 is 102.2% above this benchmark. Historically, British American Tobacco's own Debt-to-EBITDA has ranged from 1.57 to 4.50 over the past decade. While the company's 10-year median is 3.63 vs. the industry median of 1.37, British American Tobacco has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Debt-to-EBITDA for a Tobacco Products company?
The median Debt-to-EBITDA among Tobacco Products companies is 1.37, based on 35 companies in the industry. Companies in the top quartile (top 25%) have a Debt-to-EBITDA significantly above this median, while those in the bottom quartile fall well below. However, Debt-to-EBITDA should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. British American Tobacco's current Debt-to-EBITDA of 2.77 is 102.2% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Debt-to-EBITDA mean?
A high Debt-to-EBITDA can signal that a stock is expensive relative to its fundamentals. Debt-to-EBITDA ratio represents the ratio of total debt to total earnings before interest, taxes, depreciation and amortization. View historical data on British American Tobacco. For the Tobacco Products industry, the median Debt-to-EBITDA is 1.37 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. British American Tobacco's current Debt-to-EBITDA is 2.77, which is 24% below median its own 10-year median of 3.63. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is British American Tobacco stock overvalued right now?
Based on GuruFocus' analysis, British American Tobacco (CHIX:BATSL) is currently considered Significantly Overvalued. The stock's GF Value™ is £27.87, compared to a current price of £43.89 — trading 57.5% above its estimated fair value. The current Debt-to-EBITDA is 2.77, which is 24% below median its 10-year median of 3.63 and 102.2% above the Tobacco Products industry median of 1.37. British American Tobacco's overall GF Score™ is 71/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Debt-to-EBITDA calculated?
Debt-to-EBITDA is calculated from a company's financial statements. For British American Tobacco (CHIX:BATSL), the current Debt-to-EBITDA is 2.77 as of Dec. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is British American Tobacco (CHIX:BATSL) Overvalued in 2026?
Based on GuruFocus' analysis, British American Tobacco stock appears to be overvalued.
The current stock price of £43.89 is trading 57.5% above its estimated GF Value™ of £27.87.
GuruFocus considers British American Tobacco to be Significantly Overvalued.
Key valuation signals for CHIX:BATSL:
Debt-to-EBITDA: 2.77 (24% below median its 10-year median of 3.63)
GF Value™: £27.87 vs. price of £43.89 (57.5% above fair value)
Industry Position: 102.2% above the Tobacco Products median (#24 of 35)
No single metric tells the full story. See the CHIX:BATSL stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
The third-largest tobacco company by volume, British American Tobacco sold 465 billion cigarettes in 2025. Its leading brands are Dunhill, Kent, Pall Mall, Lucky Strike, and Rothmans in cigarettes. Its ownership of the Camel, Natural American Spirit, and Newport brands are limited to the US. In next-generation products, the company has the Vuse brand in vaping, Glo in heated tobacco, and Velo in modern oral tobacco. The company also owns a 22.9% stake in ITC limited, the largest Indian cigarette company.
71GF Score
Get the complete analysis for CHIX:BATSL
Debt-to-EBITDA is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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