Diageo (DEO)
NYSE:DEO
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Diageo
(NYSE:DEO)
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Rating:60Neutral
Price Target:
$84.00
▲(2.59% Upside)
Action:Reiterated
Date:11/07/25
Diageo's overall stock score is primarily influenced by its financial performance and valuation. While the company shows strong revenue growth, challenges in profitability and leverage are significant concerns. The technical analysis indicates bearish momentum, which could impact short-term performance. The valuation is fair, with an attractive dividend yield, providing some support to the stock score.
Positive Factors
Global branded portfolio & route-to-market
Diageo’s broad portfolio across spirits and beer plus an integrated production and global route-to-market provides durable revenue diversification and pricing optionality. Brand depth and distribution scale support premiumization, margin resilience, and resilience across regions and channels over time.
Negative Factors
High leverage
A debt-to-equity ratio of 2.20 represents substantial leverage for a consumer staples business, increasing interest and refinancing risk. High net debt limits strategic flexibility for M&A, buybacks or capex and magnifies earnings volatility if margins compress or growth slows.
Read all positive and negative factors
Positive Factors
Negative Factors
Global branded portfolio & route-to-market
Diageo’s broad portfolio across spirits and beer plus an integrated production and global route-to-market provides durable revenue diversification and pricing optionality. Brand depth and distribution scale support premiumization, margin resilience, and resilience across regions and channels over time.
Read all positive factors
Diageo Key Performance Indicators (KPIs)
Any
Net Sales by Geography
Shows sales distribution across various regions, indicating market strength and potential growth areas, essential for understanding Diageo's global market presence.
Shows sales distribution across various regions, indicating market strength and potential growth areas, essential for understanding Diageo's global market presence.
Data provided by:
The Fly
The FlyDiageo (DEO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$44.51B
Dividend Yield4.8%
Average Volume (3M)1.27M
Price to Earnings (P/E)18.3
Beta (1Y)0.68
Revenue Growth-1.84%
EPS Growth-33.01%
CountryUS
Employees30,092
SectorConsumer Defensive
Sector Strength42
IndustryBeverages - Wineries & Distilleries
Share Statistics
EPS (TTM)4.32
Shares Outstanding556,650,000
10 Day Avg. Volume1,130,648
30 Day Avg. Volume1,272,780
Financial Highlights & Ratios
PEG Ratio-0.61
Price to Book (P/B)5.05
Price to Sales (P/S)2.77
P/FCF Ratio20.86
Enterprise Value/Market Cap1.53
Enterprise Value/Revenue3.43
Enterprise Value/Gross Profit5.74
Enterprise Value/Ebitda12.91
Forecast
1Y Price Target
$98.00Price Target Upside19.69% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)6.44
Revenue Forecast (FY)$19.63B
Diageo Business Overview & Revenue Model
Company Description
Diageo plc, together with its subsidiaries, produces, markets, and sells alcoholic beverages. The company offers scotch, whisky, gin, vodka, rum, ready to drink products, raki, liqueur, wine, tequila, Canadian whisky, American whiskey, cachaca, an...
How the Company Makes Money
Diageo makes money primarily by selling beverage alcohol products to distributors, wholesalers, retailers, and on-trade operators (e.g., bars, restaurants, hotels) across its geographic markets. Revenue is generated from branded product sales, wit...
Diageo Earnings Call Summary
Earnings Call Date:Feb 04, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive and negative elements. While the company showed a return to organic net sales growth, market share gains, and strong performance in key segments like Tequila and Guinness, it also faced challenges such as a decline in Scotch sales, operating profit, the impact of new tariffs, and a drop in EPS. The uncertainty around tariffs adds complexity to the business outlook.Positive Updates
Organic Net Sales Growth
The company returned to organic net sales growth of 1% in the first half of fiscal '25, with growth in four out of five regions, including North America.
Negative Updates
Scotch Sales Decline
Scotch organic net sales declined by 5%, largely driven by softer industry performance in North America and Greater China.
Read all updates
Q2-2025 Updates
Positive
Negative
Organic Net Sales Growth
The company returned to organic net sales growth of 1% in the first half of fiscal '25, with growth in four out of five regions, including North America.
Read all positive updates
Company Guidance
In the first half of fiscal year 2025, Diageo reported a 1% growth in organic net sales, with significant contributions from the North American and Latin American regions. Market share was either held or increased in 65% of measured markets, notably in North America and Greater China. Despite a challenging macroeconomic environment and recent tariff announcements, the company maintained a strong performance in various categories, including Tequila, which saw a 21% rise in organic net sales. Guinness continued its momentum with 17% growth, marking its eighth consecutive half of double-digit growth. However, Scotch faced a 5% decline due to softer industry performance. The company's strategic investments in digital and market routes are aimed at enhancing financial resilience and achieving sustainable long-term growth. Diageo's focus remains on driving stronger execution and leveraging its diverse portfolio to respond to emerging consumer trends across regions.Diageo Financial Statement Overview
Summary
Income Statement
75
Positive
Balance Sheet
65
Positive
Cash Flow
60
Neutral
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 19.83B | 20.25B | 20.27B | 16.23B | 16.96B | 12.73B |
| Gross Profit | 11.83B | 12.17B | 12.20B | 9.68B | 9.48B | 7.70B |
| EBITDA | 5.26B | 6.36B | 7.24B | 6.36B | 4.93B | 4.28B |
| Net Income | 2.41B | 2.35B | 3.87B | 3.51B | 3.54B | 2.66B |
Balance Sheet | ||||||
| Total Assets | 50.20B | 49.32B | 45.47B | 35.43B | 36.52B | 31.95B |
| Cash, Cash Equivalents and Short-Term Investments | 2.69B | 2.65B | 1.13B | 1.43B | 2.54B | 2.87B |
| Total Debt | 24.17B | 24.40B | 21.50B | 16.41B | 16.02B | 15.18B |
| Total Liabilities | 36.53B | 36.14B | 33.40B | 26.19B | 27.00B | 23.52B |
| Stockholders Equity | 11.58B | 11.09B | 10.03B | 7.78B | 7.80B | 6.90B |
Cash Flow | ||||||
| Free Cash Flow | 2.52B | 2.69B | 4.55B | 3.42B | 2.84B | 3.03B |
| Operating Cash Flow | 4.12B | 4.30B | 6.07B | 4.53B | 3.94B | 3.65B |
| Investing Cash Flow | -1.50B | -1.72B | -1.59B | -1.13B | -1.34B | -1.09B |
| Financing Cash Flow | -1.86B | -1.49B | -3.11B | -2.40B | -3.57B | -2.79B |
Diageo Technical Analysis
Negative
81.88
Price Trends
79.85
Positive
83.60
Negative
88.53
Negative
Market Momentum
-0.19
Positive
46.30
Neutral
8.46
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DEO, the sentiment is Negative. The current price of 81.88 is below the 20-day moving average (MA) of 82.57, above the 50-day MA of 79.85, and below the 200-day MA of 88.53, indicating a neutral trend. The MACD of -0.19 indicates Positive momentum. The RSI at 46.30 is Neutral, neither overbought nor oversold. The STOCH value of 8.46 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DEO.
Diageo Risk Analysis
Diageo disclosed 21 risk factors in its most recent earnings report. Diageo reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Diageo Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $49.27B | 16.20 | 17.19% | 8.22% | -0.41% | 13.36% | |
69 Neutral | $12.09B | 16.78 | 19.93% | 3.41% | -0.53% | -16.82% | |
69 Neutral | $12.09B | 16.78 | 19.93% | 3.42% | -0.53% | -16.82% | |
65 Neutral | $154.76B | 21.28 | 8.66% | 1.83% | -0.33% | 18.34% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
60 Neutral | $44.51B | 18.25 | 21.39% | 4.80% | -1.84% | -33.01% | |
56 Neutral | $24.26B | 14.49 | 22.08% | 2.92% | -10.48% | ― |
* Consumer Defensive Sector Average
DEO
Diageo
80.43
-23.15
-22.35%
BUD
Anheuser-Busch Inbev Sa
78.50
8.41
12.00%
BF.A
Brown Forman A
26.69
-0.48
-1.78%
STZ
Constellation Brands
140.91
-25.70
-15.42%
BF.B
Brown-Forman B
26.16
-0.82
-3.05%
ABEV
Ambev SA
3.12
0.79
33.96%
Diageo Corporate Events
Diageo Discloses Artisan Partners Crossing 5% Shareholding Threshold
Apr 17, 2026
On 15 April 2026, investment manager Artisan Partners Limited Partnership disclosed that it had crossed a major shareholding threshold in Diageo plc, acquiring 111,928,723 voting rights in the UK drinks group. The position, notified to Diageo and ...
Diageo Updates Voting Rights and Discloses March 2026 Executive Share Dealings
Apr 1, 2026
In March 2026, Diageo reported that as of 28 February 2026 its issued share capital comprised 2,432,425,480 ordinary shares, of which 205,973,302 were held in treasury, resulting in 2,226,452,178 voting rights for regulatory disclosure purposes. T...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.