Diageo plc (DEO) is listed on NYSE and operates in the Beverages - Wineries & Distilleries industry (Consumer Defensive sector).
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.
| Rating | Analysts |
|---|---|
| Strong Buy | 0 |
| Buy | 15 |
| Hold | 16 |
| Sell | 4 |
| Strong Sell | 0 |
Diageo plc, along with its subsidiaries, is engaged in the production, marketing, and sale of alcoholic beverages. The company offers a diverse range of products, including various types of whisky, gin, vodka, rum, ready-to-drink beverages, liqueurs, wine, tequila, and brandy. Additionally, Diageo produces beer, including cider and non-alcoholic options. Its portfolio includes well-known brands such as Johnnie Walker, Crown Royal, Bulleit, Buchanan's, Smirnoff, Cîroc, Ketel One, Casamigos, DeLeon, Don Julio, Captain Morgan, Baileys, Tanqueray, and Guinness. Diageo operates across multiple regions, including North America, Europe, Turkey, Africa, Latin America, the Caribbean, and the Asia Pacific, with a presence in international markets. The company was established in 1886 and is headquartered in London, United Kingdom.
Over the past three fiscal years, the company has faced a challenging environment with revenue consistently decreasing at a CAGR of -0.8%, from $20.56 billion in 2023 to $20.25 billion in 2025. Despite this revenue decline, the gross margin showed slight improvement, increasing by 0.5pp to 60.1% by 2025. However, operating and net margins experienced significant compression, with operating margin decreasing by 5.6pp to 21.4% and net margin dropping by 10.0pp to 11.6%. This margin contraction reflects the company's struggle to maintain profitability amidst declining revenue. Earnings per share (EPS) also saw a sharp decline, with a CAGR of -26.5%, falling from $7.84 to $4.24, indicating reduced profitability on a per-share basis. Cash flow generation was inconsistent, with operating cash flow decreasing from $5.74 billion to $4.30 billion, and free cash flow (FCF) declining from $4.33 billion to $2.69 billion, resulting in a reduced FCF margin of 13.3%. Despite these challenges, the company's cash conversion ratio improved consistently, reaching 1.69, suggesting that earnings are increasingly backed by actual cash. However, the company's net debt increased consistently, rising from $18.98 billion to $22.20 billion, which, coupled with a declining interest coverage ratio now at 4.5x, indicates growing leverage concerns. The company managed to slightly reduce its share count by 1.9%, which helped mitigate some of the dilution effects on per-share metrics. Overall, the period was marked by declining revenue and profitability, increased leverage, and a focus on maintaining cash flow quality.
Recent news for Diageo plc (NYSE: DEO) highlights significant institutional trading activity and strategic business developments. On April 14, it was reported that Diageo received an average "Hold" recommendation from brokerages, with a 1-year price target of $116. Notably, Douglas Lane & Associates LLC sold 34,625 shares, valued at approximately $38.76 million, while Step Capital Management Pte. Ltd. acquired 8,000 shares worth around $690,000. Additionally, Diageo made a strategic move by selling a cricket team to a Blackstone-backed consortium for $1.8 billion, as reported on March 24. In product news, Diageo's Captain Morgan brand launched a new Sliced Colada variety pack, a 5% ABV premium malt beverage line, now available nationwide. These developments reflect Diageo's ongoing portfolio management and strategic realignment efforts, while the mixed analyst sentiment suggests a cautious market outlook.