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Diageo
(LSE:DGE)
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Rating:66Neutral
Price Target:
1,726.00 p
â–¼(-2.54% Downside)
Action:Downgraded
Date:08/10/26
The score is driven primarily by solid financial quality supported by strong margins and improved free cash flow, but held back by weakening recent revenue/earnings and elevated leverage. Technicals add support due to a strong uptrend (price above key moving averages and positive MACD), though overbought signals temper that benefit. Valuation is reasonable with a supportive dividend yield, but the P/E looks less compelling given the recent profitability decline.
Positive Factors
High operating margins
Persistently high gross and operating margins indicate substantial brand economics and pricing or mix benefits. This profitability provides Diageo with resources to support marketing, product investment, distribution, and debt service while preserving resilience across market conditions.
Negative Factors
Weakening revenue and earnings
Recent contraction in revenue and earnings weakens the near-term foundation for sustainable growth. It may reduce operating leverage and constrain investment capacity if it persists, while making recovery dependent on restoring demand, improving mix, or reversing profitability pressure.
Read all positive and negative factors
Positive Factors
Negative Factors
High operating margins
Persistently high gross and operating margins indicate substantial brand economics and pricing or mix benefits. This profitability provides Diageo with resources to support marketing, product investment, distribution, and debt service while preserving resilience across market conditions.
Read all positive factors
Diageo (DGE) vs. iShares MSCI United Kingdom ETF (EWC)
Market Cap
£35.82B
Dividend Yield3.86%
Average Volume (3M)3.66M
Price to Earnings (P/E)27.6
Beta (1Y)0.67
Revenue Growth-6.47%
EPS Growth-28.83%
CountryUK
Employees27,972
SectorConsumer Defensive
Sector Strength42
IndustryBeverages - Alcoholic
Share Statistics
EPS (TTM)0.78
Shares Outstanding2,226,657,200
10 Day Avg. Volume3,780,493
30 Day Avg. Volume3,656,236
Financial Highlights & Ratios
PEG Ratio-0.72
Price to Book (P/B)3.10
Price to Sales (P/S)1.73
P/FCF Ratio10.66
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
£1,989.47Price Target Upside12.34% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering15
EPS Forecast (FY)1.67
Revenue Forecast (FY)£19.14B
Diageo Business Overview & Revenue Model
Company Description
Diageo plc is a leading multinational enterprise engaged in the production, marketing, and global distribution of an extensive range of alcoholic beverages through its subsidiaries. The company's diverse portfolio encompasses numerous spirit categ...
How the Company Makes Money
Diageo makes money primarily by selling branded alcoholic beverages (predominantly spirits, with beer and other products in certain markets) to a range of customers including distributors, wholesalers, retailers, and on-trade venues (e.g., bars, r...
Diageo Earnings Call Summary
Earnings Call Date:Feb 04, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Jan 28, 2027
Earnings Call Sentiment Neutral
The earnings call highlighted continued growth in organic net sales and market share gains, particularly in the Tequila and Guinness segments. However, challenges remain with declining Scotch sales, a drop in organic operating profit, and significant uncertainty due to newly imposed tariffs. The decline in EPS and increased leverage ratio further contribute to a cautious outlook.Positive Updates
Return to Organic Net Sales Growth
Despite challenging macro environments, the company achieved a 1% growth in organic net sales, with growth in four out of five regions, including North America.
Negative Updates
Scotch Segment Decline
Scotch organic net sales declined by 5%, driven by softer industry performance in North America and Greater China, with down trading within the category.
Read all updates
Q2-2025 Updates
Positive
Negative
Return to Organic Net Sales Growth
Despite challenging macro environments, the company achieved a 1% growth in organic net sales, 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 momentum seen in four out of five regions, including North America. The company held or gained market share in 65% of its net sales in measured markets. Despite a challenging macroeconomic environment, Diageo demonstrated resilience, particularly in regions like Europe and Africa, and saw a modest improvement in the Latin America and Caribbean regions. The U.S. market showed a slight return to growth, driven by innovations such as smaller pack sizes and strong performances from brands like Crown Royal and Don Julio. However, the company faced challenges with a 5% decline in Scotch sales and pressures from recent U.S. tariff announcements, which could impact future guidance. The company plans to strengthen its balance sheet, focus on sustainable top-line growth, and improve operating leverage while maintaining a robust investment-grade balance sheet.Diageo Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
52
Neutral
Cash Flow
71
Positive
| Breakdown | Jun 2026 | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 19.53B | 20.25B | 20.27B | 16.23B | 15.45B |
| Gross Profit | 11.61B | 12.17B | 12.20B | 9.68B | 9.48B |
| EBITDA | 6.28B | 6.36B | 7.24B | 6.36B | 4.93B |
| Net Income | 1.73B | 2.35B | 3.87B | 3.51B | 3.25B |
Balance Sheet | |||||
| Total Assets | 47.09B | 49.32B | 45.47B | 35.43B | 36.52B |
| Cash, Cash Equivalents and Short-Term Investments | 2.03B | 2.65B | 1.13B | 1.43B | 2.54B |
| Total Debt | 22.20B | 24.40B | 21.50B | 16.41B | 16.50B |
| Total Liabilities | 34.07B | 36.14B | 33.40B | 26.19B | 27.00B |
| Stockholders Equity | 10.93B | 11.09B | 10.03B | 7.78B | 7.80B |
Cash Flow | |||||
| Free Cash Flow | 3.18B | 2.69B | 4.55B | 3.42B | 2.84B |
| Operating Cash Flow | 4.37B | 4.30B | 6.07B | 4.53B | 3.94B |
| Investing Cash Flow | -976.11M | -1.83B | -1.59B | -1.34B | -1.34B |
| Financing Cash Flow | -3.76B | -1.57B | -3.11B | -2.26B | -3.26B |
Diageo Technical Analysis
Neutral
1771.00
Price Trends
1663.66
Negative
1598.66
Positive
1584.19
Positive
Market Momentum
-11.46
Negative
46.86
Neutral
37.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:DGE, the sentiment is Neutral. The current price of 1771 is above the 20-day moving average (MA) of 1624.70, above the 50-day MA of 1663.66, and above the 200-day MA of 1584.19, indicating a neutral trend. The MACD of -11.46 indicates Negative momentum. The RSI at 46.86 is Neutral, neither overbought nor oversold. The STOCH value of 37.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GB:DGE.
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 |
|---|---|---|---|---|---|---|---|
71 Outperform | £89.17B | 14.14 | 13.38% | 5.91% | 0.70% | 110.32% | |
68 Neutral | £15.85B | 18.47 | 25.10% | 2.35% | 12.76% | 12.70% | |
66 Neutral | £35.82B | 27.61 | 15.52% | 3.86% | -6.47% | -28.83% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
61 Neutral | £643.01M | 14.05 | 13.40% | 3.25% | 6.88% | -5.66% | |
59 Neutral | £2.47B | 25.18 | 6.17% | 3.54% | 15.55% | 42.40% | |
42 Neutral | £16.64M | -2.34 | -129.39% | ― | -16.34% | -91.64% |
* Consumer Defensive Sector Average
GB:DGE
Diageo
1,624.00
-106.03
-6.13%
GB:BAG
AG Barr
576.00
-77.41
-11.85%
GB:BATS
British American Tobacco
4,129.00
430.15
11.63%
GB:CCH
Coca Cola HBC
4,354.00
1,073.96
32.74%
GB:TATE
Tate & Lyle
559.00
202.42
56.77%
GB:ART
Artisanal Spirits Company PLC
23.50
-19.00
-44.71%
Diageo Corporate Events
Business Operations and StrategyRegulatory Filings and Compliance
Diageo Updates Market on Total Voting Rights and Share Capital
Neutral
Oct 1, 2026
Diageo plc reported that its issued share capital as of 30 September 2026 comprised 2,432,397,125 ordinary shares, of which 204,816,853 were held in treasury without voting rights. This structure reflects Diageo’s ongoing use of treasury sha...
Regulatory Filings and ComplianceShareholder Meetings
Diageo Publishes Notice for Hybrid 2026 Annual General Meeting
Neutral
Sep 30, 2026
Diageo has released the formal Notice and Form of Proxy for its 2026 Annual General Meeting, which will take place on 5 November 2026 at Convene 133 Houndsditch in London. The meeting will be conducted as a hybrid event via the Lumi platform, allo...
Business Operations and StrategyExecutive/Board Changes
Diageo Appoints WPP’s Joanne Wilson as New Chief Financial Officer
Positive
Sep 23, 2026
Diageo has appointed Joanne Wilson as its new Chief Financial Officer, with plans for her to join the board and executive committee in 2027, succeeding current CFO Nik Jhangiani. Wilson, currently CFO of WPP and a non-executive director at Informa...
Business Operations and StrategyRegulatory Filings and Compliance
Diageo Discloses Executive Committee Member Share Deal Under Incentive Plan
Neutral
Sep 18, 2026
Diageo reported a routine management share transaction under its One World Share Incentive Plan involving Executive Committee member Hannah Brooks. The plan allows eligible employees to buy American Depositary Shares through salary deductions, wit...
Executive/Board ChangesRegulatory Filings and Compliance
Diageo Awards New Long-Term Equity Incentives to Executive Committee
Positive
Sep 16, 2026
Diageo has granted a series of share-based awards to members of its Executive Committee under the Diageo 2023 Long Term Incentive Plan and the Diageo Exceptional Stock Award Plan. The awards, made on 14 September 2026, comprise approved and unappr...
Executive/Board ChangesRegulatory Filings and Compliance
Diageo Grants Deferred Stock Awards to CEO and CFO
Positive
Sep 16, 2026
Diageo has granted conditional awards of Restricted Stock Units to Chief Executive Officer Sir Dave Lewis and Chief Financial Officer Nik Jhangiani under its Deferred Bonus Share Plan. The awards, representing one-third of each executive’s f...
Executive/Board ChangesRegulatory Filings and Compliance
Diageo Grants Share Options Under 2026 Sharesave Plan to Executive
Neutral
Sep 11, 2026
Diageo has granted options over ordinary shares under its 2026 Sharesave Plan, a savings-related share option scheme aimed at encouraging employee equity participation. The latest grant includes options to Executive Committee member Dan Mobley, re...
Executive/Board ChangesRegulatory Filings and Compliance
Diageo Grants Freeshares to CEO, CFO and Executive Committee Members
Positive
Sep 11, 2026
Diageo has granted awards of Freeshares under its 2001 Share Incentive Plan to several senior leaders, including Chief Executive Officer Sir Dave Lewis and Chief Financial Officer Nik Jhangiani. Members of the executive committee such as Ewan Andr...
Executive/Board ChangesRegulatory Filings and Compliance
Diageo Executives Receive Matching Shares Under Incentive Plan
Positive
Sep 11, 2026
Diageo has disclosed a series of share transactions by senior executives under its 2001 Share Incentive Plan, involving the purchase of partnership shares funded through salary deductions and the award of matching shares. Members of the Executive ...
Regulatory Filings and Compliance
Diageo Chair Sir John Manzoni Buys Shares in the Company
Positive
Sep 10, 2026
Diageo plc disclosed that its chair, Sir John Manzoni, purchased ordinary shares in the company on 10 September 2026. The transaction, conducted on the London Stock Exchange, involved the acquisition of 414 shares at a price of £15.85 per sha...
Business Operations and StrategyExecutive/Board ChangesRegulatory Filings and Compliance
Diageo Discloses Executive Share Award Vesting and Tax-Related Sales
Neutral
Sep 7, 2026
Diageo plc is a global beverages company best known for its portfolio of premium spirits and beers, including leading whisky, vodka, gin, and rum brands. The group operates internationally, with its shares represented in the U.S. through American ...
Executive/Board ChangesRegulatory Filings and Compliance
Diageo Executives Exercise Share Awards and Disclose Routine Insider Transactions
Neutral
Sep 7, 2026
Diageo has disclosed a series of share transactions by members of its Executive Committee following the release and exercise of awards under the Diageo 2014 Long Term Incentive Plan and the Diageo Exceptional Stock Award Plan. The filings, made in...
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Diageo renews European debt issuance programme with FCA-approved prospectus
Positive
Sep 7, 2026
Diageo plc, together with Diageo Finance plc and Diageo Capital B.V., has renewed its European debt issuance programme with a new prospectus approved by the U.K. Financial Conduct Authority on 7 September 2026. The prospectus for the Programme for...
Regulatory Filings and Compliance
Diageo Updates Market on Total Voting Rights and Share Capital
Neutral
Sep 1, 2026
Diageo has disclosed that, as of 31 August 2026, its issued share capital comprised 2,432,397,125 ordinary shares, of which 205,793,929 were held in treasury without voting rights. This leaves a total of 2,226,657,196 voting rights, a key referenc...
Business Operations and StrategyRegulatory Filings and Compliance
Diageo Discloses Executive Committee Share Incentive Transaction
Neutral
Aug 18, 2026
Diageo reported a routine management share dealing under its One World Share Incentive Plan involving Executive Committee member Hannah Brooks. The transaction covered the purchase of American Depositary Shares using salary deductions and a relate...
Financial DisclosuresRegulatory Filings and ComplianceShareholder Meetings
Diageo Publishes 2026 Annual Report and U.S. Form 20-F Filings
Neutral
Aug 18, 2026
Diageo has published its Annual Report for the year ended 30 June 2026 and its Form 20-F filing, making both documents available on its corporate website and via regulatory storage mechanisms in the U.K. and U.S. The release follows the company...
Business Operations and StrategyExecutive/Board Changes
Diageo adds former P&G Beauty chief Alex Keith to board
Positive
Aug 18, 2026
Diageo has appointed R. Alexandra (Alex) Keith as a non-executive director, with her joining the board on 5 November 2026 subject to shareholder approval and serving on the remuneration and nomination committees. Keith brings more than 35 years of...
Executive/Board ChangesRegulatory Filings and Compliance
Diageo Executives Acquire Shares Under Long-Running Incentive Plan
Positive
Aug 11, 2026
Diageo has disclosed a series of routine share transactions by senior executives under its 2001 Share Incentive Plan, in line with U.K. Market Abuse Regulation. Members of the executive committee, along with the chief financial officer, purchased ...
Regulatory Filings and Compliance
Diageo Chair Sir John Manzoni Buys Shares Under Company Arrangement
Neutral
Aug 11, 2026
Diageo has disclosed that its chair, Sir John Manzoni, purchased a small number of the company’s ordinary shares under an arrangement with the company, in compliance with U.K. Market Abuse Regulation reporting rules. The transaction, execute...
Business Operations and StrategyFinancial Disclosures
Diageo outlines $1bn cost savings and medium-term growth targets at Capital Markets Day
Positive
Aug 6, 2026
Diageo used its Capital Markets Day to outline progress on its turnaround strategy and a new operating model aimed at boosting competitiveness and shareholder returns. The group reaffirmed confidence in the long-term growth of spirits, including r...
Business Operations and StrategyDividendsFinancial Disclosures
Diageo absorbs impairments as restructuring drive lifts margins and cash flow
Neutral
Aug 6, 2026
Diageo reported a 3% decline in reported net sales to $19.6 billion and a 27.2% drop in reported operating profit for the year to 30 June 2026, as weakness in North America and Asia Pacific and adverse price/mix offset growth in Europe, Latin Amer...
Business Operations and StrategyFinancial Disclosures
Diageo Sets Date for Fiscal 2026 Results and Capital Markets Day
Neutral
Jul 29, 2026
Diageo plans to release its full-year fiscal 2026 preliminary results on 6 August 2026 at 11 a.m. UK time, followed by an audio recording and presentation of the figures, underscoring the company’s efforts to maintain transparent communicati...
Business Operations and StrategyExecutive/Board ChangesRegulatory Filings and Compliance
Diageo Execs Increase Holdings Under One World Share Plan
Positive
Jul 21, 2026
Diageo has disclosed executive share transactions under its One World Share Incentive Plan, highlighting ongoing use of equity-based compensation to reward and retain senior leaders. The plan involves employees purchasing partnership shares throug...
Executive/Board ChangesRegulatory Filings and Compliance
Diageo Executives Acquire Shares Under Long-Running Incentive Plan
Neutral
Jul 13, 2026
Diageo has disclosed a series of small share transactions by senior executives under its 2001 Share Incentive Plan, in line with UK Market Abuse Regulation reporting requirements. Executive Committee members and the chief financial officer purchas...
Regulatory Filings and Compliance
Diageo Chair Sir John Manzoni Buys Shares Under Company Arrangement
Positive
Jul 10, 2026
Diageo reported that its chair, Sir John Manzoni, has purchased 436 ordinary shares in the company on 10 July 2026 under an arrangement with the group. The transaction was executed on the London Stock Exchange at a price of £15.03 per share a...
DividendsRegulatory Filings and Compliance
Diageo Chair Receives Shares via Dividend Reinvestment Plan
Neutral
Jul 3, 2026
As part of Diageo’s regular share-based remuneration and disclosure practices, Chair Sir John Manzoni received 31 ordinary shares through the company’s Dividend Reinvestment Plan linked to the interim dividend paid on 4 June 2026.The 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.