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In calculating the Net-Net Working Capital (NNWC), Benjamin Graham assumed that a company's accounts receivable is only worth 75% its value, its inventory is only worth 50% of its value, but its liabilities have to be paid in full. In addition, Graham believed that preferred stock belongs on the liability side of the balance sheet, not as part of capital and surplus. This is a conservative way of estimating the company's value.
British American Tobacco's Net-Net Working Capital for the quarter that ended in Dec. 2025 was £-24.30.
The industry rank for British American Tobacco's Net-Net Working Capital or its related term are showing as below:
CHIX:BATSl's Price-to-Net-Net-Working-Capital is not ranked *
in the Tobacco Products industry.
Industry Median: 8.32 * Ranked among companies with meaningful Price-to-Net-Net-Working-Capital only.
British American Tobacco (CHIX:BATSl) Net-Net Working Capital Explanation
One research study, covering the years 1970 through 1983 showed that portfolios picked at the beginning of each year, and held for one year, returned 29.4 percent, on average, over the 13-year period, compared to 11.5 percent for the S&P 500 Index. Other studies of Graham's strategy produced similar results.
Benjamin Graham looked for companies whose market values were less than two-thirds of their net-net value. They are collected under our Net-Net screener.
British American Tobacco Net-Net Working Capital Related Terms
British American Tobacco Net-Net Working Capital Historical Data
* Premium members only.
The historical data trend for British American Tobacco's Net-Net Working Capital can be seen below:
* 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.
British American Tobacco Net-Net Working Capital Chart
CHIX:BATSL vs PM, MO, TPB: Net-Net Working Capital Comparison
For the Tobacco subindustry, British American Tobacco's Price-to-Net-Net-Working-Capital, along with its competitors' market caps and Price-to-Net-Net-Working-Capital 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 Price-to-Net-Net-Working-Capital vs Tobacco Products Industry
For the Tobacco Products industry and Consumer Defensive sector, British American Tobacco's Price-to-Net-Net-Working-Capital distribution charts can be found below:
* The bar in red indicates where British American Tobacco's Price-to-Net-Net-Working-Capital 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 calculating the Net-Net Working Capital (NNWC), Benjamin Graham assumed that a company's accounts receivable is only worth 75% its value, its inventory is only worth 50% of its value, but its liabilities have to be paid in full.
In addition, Graham believed that preferred stock belongs on the liability side of the balance sheet, not as part of capital and surplus. In "Security Analysis", preferred stock is dubbed "an imperfect creditorship position" that is best placed on the balance sheet alongside funded debt.
This is a conservative way of estimating the company's value.
What does a Net-Net Working Capital of £-24.30 mean?
British American Tobacco (CHIX:BATSL) has a Net-Net Working Capital of £-24.30 as of Dec. 2025. Ben Graham defined net-net working capital as the per-share sum of cash, 75% of receivables and 50% of inventory less total liabilities. View historical data on British American Tobacco According to the industry distribution chart, British American Tobacco ranks #999999 out of 19 companies in the Tobacco Products industry.
Is British American Tobacco's Net-Net Working Capital too high?
British American Tobacco's current Net-Net Working Capital is £-24.30. Based on the distribution chart, British American Tobacco ranks #999999 out of 19 companies in the Tobacco Products industry, which is in the bottom quartile relative to peers. 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 Net-Net Working Capital compare to PM and MO?
According to the Tobacco Products industry distribution chart, British American Tobacco ranks #999999 out of 19 companies for Net-Net Working Capital. This places British American Tobacco in the lower half of its industry. The industry median Net-Net Working Capital is 8.32. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Net-Net Working Capital for a Tobacco Products company?
The median Net-Net Working Capital among Tobacco Products companies is 8.32, based on 19 companies in the industry. Companies in the top quartile (top 25%) have a Net-Net Working Capital significantly above this median, while those in the bottom quartile fall well below. However, Net-Net Working Capital should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Net-Net Working Capital mean?
A high Net-Net Working Capital can signal that a stock is expensive relative to its fundamentals. Ben Graham defined net-net working capital as the per-share sum of cash, 75% of receivables and 50% of inventory less total liabilities. View historical data on British American Tobacco For the Tobacco Products industry, the median Net-Net Working Capital is 8.32 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. British American Tobacco's current Net-Net Working Capital is £-24.30. 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 £43.74 — trading 56.9% above its estimated fair value. The current Net-Net Working Capital is £-24.30. 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 Net-Net Working Capital calculated?
Net-Net Working Capital is calculated from a company's financial statements. For British American Tobacco (CHIX:BATSL), the current Net-Net Working Capital is £-24.30 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 £43.74 is trading 56.9% above its estimated GF Value™ of £27.87.
GuruFocus considers British American Tobacco to be Significantly Overvalued.
Key valuation signals for CHIX:BATSL:
Net-Net Working Capital: £-24.30
GF Value™: £27.87 vs. price of £43.74 (56.9% above fair value)
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
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