British American Tobacco Plc ADR (BTI) is slightly undervalued and Philip Morris International Inc (PM) is overvalued.
Against our estimates of intrinsic value, BTI trades at the wider discount: a margin of safety of +13%, against -29% for PM.
Values as of the 22 Sept 2026 close.
Discounting its cash flows at 6.9% (average of 3 methods) values the shares at $63.90; the price of $55.75 is 13% below that value, and 83% of that value comes from beyond year five.
Leak Score 65/100 on 3 of 12 signals
Discounting its cash flows at 7.4% (average of 3 methods) values the shares at $147.10; the price of $190.23 is 29% above that value, and 82% of that value comes from beyond year five.
Leak Score 50/100 on 8 of 12 signals
| Metric | BTI | PM |
|---|---|---|
| Verdict | Slightly undervalued | Overvalued |
| Price | $55.75 | $190.23 |
| Intrinsic value | $63.90 | $147.10 |
| Margin of safety | +13% | -29% |
| Leak Score | 65/100 (3/12) | 50/100 (8/12) |
| Market cap | $120.0B | $296.5B |
| Revenue growth, 5 years | 0.5% | 7.2% |
| Operating margin | 37.9% | 37.3% |
| Net margin | 24.6% | 25.6% |
| Return on equity | 13.3% | — |
| Debt to equity | 0.72 | — |
| P/E | 14.3x | 27.3x |
| Forward P/E | 10.7x | 20.8x |
| P/B | 1.9x | — |
| Dividend yield | 6.1% | 3.2% |