Reynolds American, Inc. RAI 0.25% shares dropped more than 3 percent following the company’s Q3 earnings report. However, Citi analyst Adam Spielman believes Reynolds’ underlying business is actually performing really well and sees the earnings sell-off as a buying opportunity.

According to Spielman, Reynolds’ headline sales miss had nothing to do with demand.

“On the call, RAI said that (1) calendar effects reduced volumes by about 1% in the quarter, and (2) the end of the Reciprocal Manufacturing Agreement with Imperial reduced pricing by about 2 percent,” Spielman noted.

While the end of the RMA agreement negatively impacted Q3 pricing, Citi expects it will boost margins in Q4 and beyond.

Citi has dialed back its 2016 EPS forecast for Reynolds by about 1 percent, but Spielman said the adjustment is mostly due to higher interest and tax charges.

Looking ahead, he sees the company’s November 14 Investor Day as the next potential catalyst for the stock. However, the upcoming catalyst with the most potential to significantly move the stock will be…

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