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Tobacco cheers income investors

Tobacco is never going to win any ESG prizes but the dividends cannot be ignored if income is your goal
Tobacco cheers income investors

Generating income of any kind when interest rates are zero is why the FTSE’s ugly sisters, British American Tobacco (BATS) and Imperial Brands (IMB), continue to hold investor interest at a time when ethical and social concerns are rapidly defining the investment landscape. The bottom line still counts when it comes to dividend pay-outs, and the tobacco giants are just too big and important in this respect to simply be sidelined.

What income investors will find trickier is making an accurate distinction between the companies when it comes to the quality of their earnings and the support this provides for underlying dividends. But choices must be made and BATS remains our favourite dividend major in the tobacco sector.

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