Diageo (DGE) AI Stock Analysis

• Market Cap: $39.56B
• Dividend Yield: 4.44%
• Average Volume (3M): 4.04M
• Price to Earnings (P/E): 21.7
• Beta (1Y): 0.75
• Revenue Growth: -2.83%
• EPS Growth: -40.42%
• Country: UK
• Employees: 30,092
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Beverages - Wineries & Distilleries
• EPS (TTM): 0.49
• Shares Outstanding: 2,225,378,200
• 10 Day Avg. Volume: 4,251,741
• 30 Day Avg. Volume: 4,044,858
• PEG Ratio: -0.45
• Price to Book (P/B): 3.66
• Price to Sales (P/S): 2.01
• P/FCF Ratio: 15.13
• Enterprise Value/Market Cap: 1.47
• Enterprise Value/Revenue: 2.87
• Enterprise Value/Gross Profit: 4.75
• Enterprise Value/Ebitda: 9.06
• 1Y Price Target: $2,367.69
• Price Target Upside: 33.62% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 60 Neutral
• Price Target: 2,057.00p ▲(16.08% Upside)

Diageo's overall stock score is driven by strong financial performance, despite challenges in profitability and cash flow stability. The technical analysis indicates a bearish trend, and the valuation suggests potential overvaluation. The dividend yield offers some appeal to income investors.

Positive Factors

Negative Factors

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, and brandy, as well as beer, including cider and non-alcoholic products. It provides its products under the Johnnie Walker, Crown Royal, Bulleit and Buchanan's whiskies, Smirnoff, Cîroc and Ketel One vodkas, Casamigos, DeLeon and Don Julio tequilas, Captain Morgan, Baileys, Tanqueray, and Guinness brands. The company operates in North America, Europe, Turkey, Africa, Latin America, the Caribbean, the Asia Pacific, and internationally. The company was incorporated in 1886 and is headquartered in London, the United Kingdom.

How the Company Makes Money

Diageo generates revenue primarily through the sale of its alcoholic beverages across various markets. The company's revenue model is based on a combination of direct sales, distribution partnerships, and licensing agreements. Key revenue streams include premium spirits, which contribute significantly to profitability, as well as beer and ready-to-drink products. Additionally, Diageo benefits from strategic partnerships with distributors and retailers, enhancing its market reach and driving sales. The company also invests in marketing and brand development to maintain its competitive edge, leveraging its strong portfolio to capitalize on global trends in consumer preferences for premium and craft beverages.

Diageo Financial Statement Overview

Summary

Diageo demonstrates strong revenue growth and operational efficiency, but faces challenges with profitability margins and cash flow stability. The high leverage requires careful management to maintain financial health.

Income Statement

Diageo's income statement shows a strong gross profit margin and consistent revenue growth over the years, with a notable 18.3% growth in the most recent year. However, the net profit margin has decreased from previous years, indicating some pressure on profitability. The EBIT and EBITDA margins remain healthy, reflecting operational efficiency.

Balance Sheet

The balance sheet indicates a high debt-to-equity ratio, which suggests significant leverage. However, the company maintains a solid return on equity, demonstrating effective use of shareholder funds. The equity ratio is moderate, indicating a balanced asset structure.

Cash Flow

Diageo's cash flow statement reveals a decline in free cash flow growth, which could be a concern for future liquidity. The operating cash flow to net income ratio is stable, but the free cash flow to net income ratio has shown some volatility, indicating potential cash flow management challenges.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	20.21B	20.25B	20.27B	20.55B	15.45B	12.73B
Gross Profit	12.21B	12.17B	12.20B	12.27B	9.48B	7.70B
EBITDA	6.41B	6.36B	7.24B	8.06B	4.93B	4.20B
Net Income	3.60B	2.35B	3.87B	4.45B	3.94B	2.66B
Balance Sheet
Total Assets	46.95B	49.32B	45.47B	44.88B	36.52B	31.95B
Cash, Cash Equivalents and Short-Term Investments	1.66B	2.65B	1.13B	1.81B	2.54B	2.87B
Total Debt	21.72B	24.40B	21.50B	20.79B	16.02B	14.73B
Total Liabilities	34.54B	36.14B	33.40B	33.17B	27.00B	23.52B
Stockholders Equity	10.28B	11.09B	10.03B	9.86B	7.80B	6.90B
Cash Flow
Free Cash Flow	5.57B	2.69B	4.55B	4.33B	2.84B	3.03B
Operating Cash Flow	7.13B	4.30B	6.07B	5.74B	3.94B	3.65B
Investing Cash Flow	-1.51B	-1.72B	-1.59B	-1.43B	-1.34B	-1.09B
Financing Cash Flow	-2.54B	-1.49B	-3.11B	-3.04B	-3.26B	-2.79B

Diageo Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1772.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:DGE, the sentiment is Negative. The current price of 1772 is below the 20-day moving average (MA) of 1919.07, below the 50-day MA of 1957.46, and below the 200-day MA of 2100.26, indicating a bearish trend. The MACD of -60.79 indicates Positive momentum. The RSI at 19.91 is Positive, neither overbought nor oversold. The STOCH value of 4.09 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:DGE.

Diageo Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CCH	75 Outperform	13.07B	17.00	25.60%	2.10%	6.00%	42.42%
BAG	71 Outperform	752.04M	18.88	12.50%	2.49%	5.10%	3.23%
CWK	71 Outperform	2.67B	19.89	13.59%	2.02%	4.77%	18.94%
TATE	67 Neutral	2.04B	33.45	8.99%	4.28%	5.40%	-67.46%
BATS	66 Neutral	84.96B	28.03	6.18%	6.11%	-2.24%	―
DGE	60 Neutral	$39.56B	21.74	22.29%	4.44%	-2.83%	-40.42%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%

Diageo Corporate Events

Diageo Aligns Leadership Incentives with Long-Term Growth Strategy

Diageo has announced the granting of various share awards to its directors and key managerial personnel under the Diageo 2023 Long Term Incentive Plan and the Diageo Exceptional Stock Award Plan. These awards, which include options and restricted stock units, are subject to performance conditions and are part of the company’s strategy to align the interests of its leadership with long-term shareholder value. This move is expected to strengthen Diageo’s market position by incentivizing its leadership to drive performance and growth, potentially impacting stakeholders positively by enhancing the company’s operational focus and strategic execution.

The most recent analyst rating on (GB:DGE) stock is a Buy with a £24.00 price target. To see the full list of analyst forecasts on Diageo stock, see the GB:DGE Stock Forecast page.

Diageo Awards Freeshares to Key Executives Under Incentive Plan

Diageo plc has announced the award of Freeshares under its 2001 Share Incentive Plan to several key executives, including the Interim Chief Executive and members of the Executive Committee. This move, disclosed in compliance with the UK Market Abuse Regulation, reflects Diageo’s commitment to aligning the interests of its leadership with those of its shareholders, potentially impacting the company’s governance and stakeholder relations.

The most recent analyst rating on (GB:DGE) stock is a Buy with a £24.00 price target. To see the full list of analyst forecasts on Diageo stock, see the GB:DGE Stock Forecast page.

Diageo Awards Restricted Stock Units to Interim CEO

Diageo PLC announced a conditional award of Restricted Stock Units to Nik Jhangiani, the Interim Chief Executive, under the Diageo Deferred Bonus Share Plan. This award, which is part of Jhangiani’s Annual Incentive Plan for fiscal 2025, will vest on June 30, 2028, reflecting Diageo’s commitment to aligning executive incentives with long-term company performance.

The most recent analyst rating on (GB:DGE) stock is a Buy with a £24.00 price target. To see the full list of analyst forecasts on Diageo stock, see the GB:DGE Stock Forecast page.

Diageo Announces Executive Share Transactions Under Incentive Plans

Diageo plc announced the release and exercise of various awards and options under its Long Term Incentive Plans and Exceptional Stock Award Plan, involving American Depositary Shares. These transactions, conducted by members of the Executive Committee, including Alvaro Cardenas and Sally Grimes, were made to cover tax liabilities and were reported in compliance with the UK Market Abuse Regulation. The transactions took place on the New York Stock Exchange and outside trading venues, reflecting Diageo’s ongoing commitment to transparency and regulatory compliance.

The most recent analyst rating on (GB:DGE) stock is a Hold with a £2272.00 price target. To see the full list of analyst forecasts on Diageo stock, see the GB:DGE Stock Forecast page.

Diageo Executives Exercise Long Term Incentive Plan Awards

Diageo has announced the release and exercise of various awards or options under its 2014 Long Term Incentive Plan, impacting ordinary shares. This move involves key members of the Executive Committee, including Ewan Andrew and Cristina Diezhandino, who have engaged in transactions to release awards and sell shares to cover tax liabilities. These transactions, conducted on September 2, 2025, reflect Diageo’s ongoing commitment to aligning executive incentives with shareholder interests, potentially influencing market perceptions and stakeholder confidence.

The most recent analyst rating on (GB:DGE) stock is a Hold with a £2272.00 price target. To see the full list of analyst forecasts on Diageo stock, see the GB:DGE Stock Forecast page.

Diageo Announces Total Voting Rights and Capital Structure

Diageo PLC has announced its total voting rights and capital structure as of August 31, 2025. The company reported an issued capital of 2,432,425,127 Ordinary Shares, with 207,046,917 shares held in Treasury, resulting in a total of 2,225,378,210 voting rights. This information is crucial for shareholders to determine their notification obligations under the FCA’s Disclosure Guidelines and Transparency Rules.

The most recent analyst rating on (GB:DGE) stock is a Hold with a £2272.00 price target. To see the full list of analyst forecasts on Diageo stock, see the GB:DGE Stock Forecast page.

Diageo Announces Approval of 2025 Debt Issuance Prospectus

Diageo plc, along with its subsidiaries Diageo Finance plc and Diageo Capital B.V., announced the approval of their 2025 prospectus by the Financial Conduct Authority. This approval is part of their annual renewal of the European debt issuance programme, which is crucial for maintaining their financial strategies and operations. The prospectus outlines the programme for the issuance of debt instruments, which is a key component in supporting Diageo’s financial structure and market positioning.

The most recent analyst rating on (GB:DGE) stock is a Hold with a £2272.00 price target. To see the full list of analyst forecasts on Diageo stock, see the GB:DGE Stock Forecast page.