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olivLaw · US equity research

Diageo plc DEO

Beverages · SIC 2080 · Vertical: Beverages (SIC 2080)

97.70USD+3.88% · 1 dayClose 04 Nov 2026

Diageo is a global leader in beverage alcohol, with a portfolio of whisky, vodka, tequila and Guinness beer sold in nearly 180 countries. The company is in a major transformation: its new chief executive has announced a new strategy, and sales fell in the latest fiscal year, with weakness in North America while debt is being reduced. Reported net sales were 19.6 billion USD.

The AI analysis may be outdated: new filings came after its sources (see the «AI analysis» section).

At the close of 04 Nov 2026, Diageo plc (DEO) stock was 97.70 USD (+3.88% on the day), with market capitalisation 237.6 bn USD, P/E 92.4 on diluted EPS of 1.06 USD over the last 12 months, beta 0.30, 52-week range 72.47–102.14 USD.

Data as of · AI analysis dated · Source: SEC filings and closing prices, computed by olivLaw.

Market cap
237.6 bn USD
shares as of 30 Jun 2026
P/E (TTM)
92.4
Diluted EPS TTM 1.06 · TTM to 30 Jun 2025
E/P (TTM)
1.08%
TTM to 30 Jun 2025
Dividend yield
unavailable
Beta (2y)
0.30
Volatility (1y) 35%
52-week range
72.47102.14

Price history

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Technical reading

RSI (14)
62.0
strong (55–70)
Bollinger (20, 2)
86.99 – 99.00
in the upper half of the band · %B 0.89 · band width 12.9%
SMA 50 / 200
89.73 / 85.89
uptrend (price > SMA50 > SMA200)
MACD (12, 26, 9)
1.87 / 1.63
MACD above signal

Indicators describe past prices; on their own they do not predict direction. On our history the RSI ≤ 40 filter added no return (see the signals methodology).

Performance

CompanyS&P 500vs S&P 500Vertical median
1 month+16.4%−1.1%+17.4 pp—
3 months+10.5%−0.5%+10.9 pp—
6 months+15.5%+4.4%+11.1 pp—
Year to date+13.2%+12.3%+0.9 pp—
1 year+5.0%+13.5%−8.6 pp+1.2%
3 years−38.8%+76.4%−115.2 pp−27.4%
5 years−52.3%+63.7%−115.9 pp—
Max drawdown (1y)
−29.0%
24 Feb 2026 → 24 Mar 2026
Max drawdown (5y)
−67.4%
04 Jan 2022 → 24 Mar 2026
Compound annual growth (5y)
−13.7%
S&P 500 +10.4%

Price returns, dividends excluded.

Quarterly results

ESEF annual reports carry no quarters: the results are annual (below).

E/P over time

E/P = trailing-12-month diluted EPS / price at quarter end. E/P is the inverse of P/E and stays defined when earnings are negative.

Today's P/E sits at the 50 percentile of its own 4-quarter history (min 73.0, median 91.6, max 95.4; quarters with earnings only).

Fiscal years

Fiscal year2018201920202021⚠ 2022202320242025
Revenue18.4 bn19.3 bn17.7 bn19.2 bn29.8 bn28.3 bn27.9 bn28.0 bn
Revenue YoYunavailable+4.7%−8.3%+8.2%—−5.0%−1.3%+0.3%
Net income3.0 bn3.2 bn1.4 bn2.7 bn4.4 bn4.5 bn4.2 bn2.5 bn
Net income YoYunavailable+4.6%−55.4%+88.8%—+1.6%−7.0%−39.1%
Diluted EPSunavailableunavailableunavailableunavailable1.841.961.731.06
Diluted EPS YoYunavailableunavailableunavailableunavailable—+6.3%−11.7%−38.8%
net %16.4%16.4%8.0%13.9%14.8%15.8%14.9%9.1%
Free cash flowunavailableunavailableunavailableunavailableunavailableunavailableunavailableunavailable

The series breaks before 2022: earlier years come from the original reports of the issuer of that time, later years from a subsequent filing that restated the perimeter (a separation, discontinued operations). The year-on-year change across the break is not shown.

Reported results vs expectations

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Balance sheet & financial health

Fiscal year 2025 · 30 Jun 2025

Cash
2.2 bn USD
Financial debt
23.7 bn USD
Net debt
21.5 bn USD
Equity
13.2 bn USD
Total assets
49.3 bn USD
Debt / equity
1.80x
Current ratio
1.63x
ROE
20.1%
ROA
5.4%
FCF margin
unavailable

Financial statements (source on every figure)

Revenue and net income (USD)

Margins

Income statement · USD

Revenue
2023
28.3 bn
2024
27.9 bn
2025
28.0 bn

SEC (XBRL)· 14 Aug 2025verified

Cost of revenue
2023
8.3 bn
2024
8.1 bn
2025
8.1 bn

SEC (XBRL)· 14 Aug 2025verified

Gross profit
2023
12.3 bn
2024
12.2 bn
2025
12.2 bn

SEC (XBRL)· 14 Aug 2025verified

Research & development
2023
63.0 m
2024
69.0 m
2025
74.0 m

SEC (XBRL)· 14 Aug 2025verified

Operating income
2023
5.5 bn
2024
6.0 bn
2025
4.3 bn

SEC (XBRL)· 14 Aug 2025verified

Interest expense
2023
1.1 bn
2024
1.3 bn
2025
1.3 bn

SEC (XBRL)· 14 Aug 2025verified

Pre-tax income
2023
5.6 bn
2024
5.5 bn
2025
3.5 bn

SEC (XBRL)· 14 Aug 2025verified

Income tax
2023
1.2 bn
2024
1.3 bn
2025
999.0 m

SEC (XBRL)· 14 Aug 2025verified

Net income
2023
4.5 bn
2024
4.2 bn
2025
2.5 bn

SEC (XBRL)· 14 Aug 2025verified

Diluted EPS
2023
1.96
2024
1.73
2025
1.06

SEC (XBRL)· 14 Aug 2025verified

Weighted average diluted shares
2023
2.3 bn
2024
2.2 bn
2025
2.2 bn

SEC (XBRL)· 14 Aug 2025verified

Balance sheet · USD

Cash
2023
1.8 bn
2024
1.1 bn
2025
2.2 bn

SEC (XBRL)· 14 Aug 2025verified

Receivables
2023
3.4 bn
2024
3.5 bn
2025
3.5 bn

SEC (XBRL)· 14 Aug 2025verified

Inventories
2023
9.7 bn
2024
9.7 bn
2025
10.7 bn

SEC (XBRL)· 14 Aug 2025verified

Current assets
2023
15.6 bn
2024
15.1 bn
2025
17.5 bn

SEC (XBRL)· 14 Aug 2025verified

Property, plant & equipment, net
2023
7.7 bn
2024
8.5 bn
2025
9.5 bn

SEC (XBRL)· 14 Aug 2025verified

Goodwill
2023
2.8 bn
2024
2.9 bn
2025
2.9 bn

SEC (XBRL)· 14 Aug 2025verified

Total assets
2023
44.9 bn
2024
45.5 bn
2025
49.3 bn

SEC (XBRL)· 14 Aug 2025verified

Accounts payable
2023
6.7 bn
2024
6.4 bn
2025
7.0 bn

SEC (XBRL)· 14 Aug 2025verified

Short-term debt
2023
2.1 bn
2024
2.9 bn
2025
2.9 bn

SEC (XBRL)· 14 Aug 2025verified

Long-term debt
2023
18.6 bn
2024
18.6 bn
2025
20.8 bn

SEC (XBRL)· 14 Aug 2025verified

Current liabilities
2023
9.6 bn
2024
9.9 bn
2025
10.7 bn

SEC (XBRL)· 14 Aug 2025verified

Total liabilities
2023
33.2 bn
2024
33.4 bn
2025
36.1 bn

SEC (XBRL)· 14 Aug 2025verified

Equity
2023
11.7 bn
2024
12.1 bn
2025
13.2 bn

SEC (XBRL)· 14 Aug 2025verified

Shares outstanding at year end
2023
2.5 bn
2024
2.4 bn
2025
2.4 bn

SEC (XBRL)· 14 Aug 2025verified

Cash flow · USD

Operating cash flow
2023
3.6 bn
2024
4.1 bn
2025
4.3 bn

SEC (XBRL)· 14 Aug 2025verified

Investing cash flow
2023
-1.4 bn
2024
-1.6 bn
2025
-1.7 bn

SEC (XBRL)· 14 Aug 2025verified

Financing cash flow
2023
-3.0 bn
2024
-3.1 bn
2025
-1.5 bn

SEC (XBRL)· 14 Aug 2025verified

Computed indicators

Growth

Revenue growth (YoY)
0.3%
computed by olivLawFY 2025
Revenue CAGR 3Y
-2.0%
computed by olivLawFY 2022 → FY 2025
Revenue CAGR 5Y
9.6%
computed by olivLawFY 2020 → FY 2025
EBIT growth (YoY)
-27.8%
computed by olivLawFY 2025
Net income growth (YoY)
-39.1%
computed by olivLawFY 2025
Net income CAGR 3Y
-16.8%
computed by olivLawFY 2022 → FY 2025
Net income CAGR 5Y
12.5%
computed by olivLawFY 2020 → FY 2025
EPS growth (YoY)
-38.8%
computed by olivLawFY 2025
EPS CAGR 3Y
-16.9%
computed by olivLawFY 2022 → FY 2025
EPS CAGR 5Y
unavailable
input data missing
FCF growth (YoY)
unavailable
input data missing

Profitability

Gross margin
43.5%
computed by olivLawFY 2025
EBITDA margin
unavailable
input data missing
EBIT margin
15.5%
computed by olivLawFY 2025
Net margin
9.1%
computed by olivLawFY 2025
FCF margin
unavailable
input data missing

Returns

ROE
24.0%
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
ROA
5.4%
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
ROIC
9.3%
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
ROCE
11.2%
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
Payout ratio (EPS)
unavailable
input data missing
Payout ratio (FCF)
unavailable
input data missing

Balance sheet

Net debt
21.5 bn USD
computed by olivLawbalance sheet at 30 Jun 2025
Net debt / EBITDA
unavailable
input data missing
Debt / equity
2.1x
computed by olivLawbalance sheet at 30 Jun 2025
Interest coverage
3.5x
computed by olivLawFY 2025

Liquidity

Current ratio
1.6x
computed by olivLawbalance sheet at 30 Jun 2025
Quick ratio
0.6x
computed by olivLawbalance sheet at 30 Jun 2025
Cash ratio
0.2x
computed by olivLawbalance sheet at 30 Jun 2025

Cash

Operating cash flow
4.3 bn USD
computed by olivLawFY 2025
Capital expenditure
unavailable
input data missing
Free cash flow
unavailable
input data missing
FCF conversion
unavailable
input data missing
Cash conversion
unavailable
input data missing

Efficiency

Days sales outstanding
46 days
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
Days inventory outstanding
461 days
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
Days payables outstanding
301 days
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
Cash conversion cycle
206 days
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025

Market and valuation

Market capitalisation
237.6 bn USD
computed by olivLawbalance sheet at 30 Jun 2025
Enterprise value
259.2 bn USD
computed by olivLawbalance sheet at 30 Jun 2025
Market cap / net income TTM
93.6x
computed by olivLawFY 2025
P/E (TTM)
92.4x
computed by olivLawFY 2025
Earnings yield
1.1%
computed by olivLawFY 2025
P/B
21.4x
computed by olivLawbalance sheet at 30 Jun 2025
P/S
8.5x
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
EV/EBITDA
unavailable
input data missing
EV/EBIT
59.8x
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
EV/Sales
9.3x
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
P/FCF
unavailable
input data missing
FCF yield
unavailable
input data missing
Dividend yield
unavailable
no dividend in the structured statements; a missing line is not a confirmed zero
Shareholder yield (distributions)
unavailable
input data missing

1 indicators that do not apply to the sector.

Valuation

olivLaw classification

Insufficient data
What is missing
  • score weight coverage: 54.2% of at least 60%

A scoring methodology on indicators and valuation, not investment advice.

Closing price

97.70 USD

04 Nov 2026Source: olivLaw, closing series

Market cap: 237.6 bn USD

Key indicators

Market capitalisation
237.6 bn USD
computed by olivLawbalance sheet at 30 Jun 2025
P/E (TTM)
92.4x
computed by olivLawFY 2025
P/B
21.4x
computed by olivLawbalance sheet at 30 Jun 2025
EV/EBITDA
unavailable
input data missing
ROE
24.0%
computed by olivLawFY 2025 · balance sheet at 30 Jun 2025
Net margin
9.1%
computed by olivLawFY 2025
Revenue growth (YoY)
0.3%
computed by olivLawFY 2025
Dividend yield
unavailable
no dividend in the structured statements; a missing line is not a confirmed zero

Coverage and freshness

28/37 reporting lines present
Latest full fiscal year: 2025
Latest reported period: 30 Jun 2025
Latest balance sheet date: 30 Jun 2025
Share count (cover of the latest filing), as of: 30 Jun 2026
Source: SEC (XBRL)published 18 Aug 2026
verified 142

The data is older than the freshness threshold.

Score by group

54% · Insufficient data

Estimated value range

Low
20.62
USD per share
Mid
29.81
USD per share
High
35.59
USD per share
Price: 97.70 USD
The price is above the range
Potential to the central value: -69.5% (value / price − 1)
Margin of safety: -227.7% (1 − price / value)
Agreement between methods: single method · 1 methods used · 1 independent bases

The combined range = the median of the valid methods' low, central and high values; it is not a probability interval and does not cover every result. Envelope of all methods: 20.62 – 35.59 USD.

Valuation assumptions are editorial choices, not measured; beta is not measured.

Method ranges (USD per share)

— — Mid · ▏ Price

Valuation methods

  • DCF (discounted cash flow)unavailable · input data missing
  • Peers: EV/EBITDAunavailable · input data missing
  • Peers: P/E20.62 – 35.59 (Mid 29.81)
    7 companies used · median multiple 28.2x · quartiles 19.5x – 33.7x
    BF-A, BUDA, COCO, KDP, KO, PEP, YHC
  • Dividend discount (DDM)unavailable · the company pays no dividend: a dividend model needs an explicit initiation assumption
Multiple comparisons use the SIC vertical: Beverages (SIC 2080)

Classification (SIC) comparables group by industry code, not by economic activity; the direct group is an editorial selection by activity. Members' multiples are on their own trailing twelve months, at their own latest close.

Assumptions (illustrative, editorial)

Risk-free rate
4.3%
Equity risk premium
5.0%
Beta (default)
1.00
Cost of equity
9.3%
Terminal growth
2.5%

Factor scorecard

Insufficient data

Minimum-evidence gate: score weight coverage: 54.2% of at least 60%

FactorValueScoreWeight used
ROIC · Quality9.3%54 (vs peers)19%
Net margin · Quality9.1%59 (vs peers)12%
FCF conversion · Qualityunavailableunavailable—
Revenue CAGR 3Y · Growth-2.0%0 (on a fixed band)15%
EPS CAGR 3Y · Growth-16.9%0 (on a fixed band)15%
Net debt / EBITDA · Balance sheetunavailableunavailable—
Interest coverage · Balance sheet3.5x30 (on a fixed band)12%
Current ratio · Balance sheet1.6x69 (on a fixed band)8%
P/E (TTM) · Valuation92.4x0 (vs peers)19%
EV/EBITDA · Valuationunavailableunavailable—
FCF yield · Valuationunavailableunavailable—
Shareholder yield (distributions) · Returnsunavailableunavailable—
Payout ratio (FCF) · Returnsunavailableunavailable—

Factors without a value were dropped; the remaining weights were renormalised.

Score groups

  • Balance sheet46/100 · 2/3 factors with a value
  • Growth0/100 · 2/2 factors with a value
  • Quality56/100 · 2/3 factors with a value
  • Returns· partialunavailable · 0/2 factors with a value
  • Valuation· partial0/100 · 1/3 factors with a value

A «partial» group is computed from under half of its weight or from one factor: it is not a full assessment of the group.

Memo

DIAGEO plc (DEO). Latest full fiscal year: 2025; data up to 2025-06-30.

Figures computed from the financial statements: revenue 28.0 bn USD in 2025; YoY growth 0.3%; net margin 9.1%; ROE 24.0%.

The estimated value range is 20.62–35.59 USD per share (median of 1 methods, agreement: single method); assumptions are illustrative. Against the central value of 29.81 USD, the price of 97.70 USD leaves a potential of -69.5% (value / price − 1) and a margin of safety of -227.7% (1 − price / value). The range is the median of the methods' low, central and high values, not a probability interval.

Insufficient data for a verdict (score weight coverage: 54.2% of at least 60%).

Text generated deterministically from the figures shown; no language model. Not investment advice.

What supports the thesis

No signal among the computed factors. That is not an absence of risk: factors without data were not assessed, and business risks (margins, inventory, demand) are in the source-based analysis.

What contradicts it

  • Revenue CAGR 3Y: -2.0%
  • EPS CAGR 3Y: -16.9%
  • P/E (TTM): 92.4x
  • The price is above the estimated value range

Not assessed (insufficient data or a ratio without meaning): FCF conversion, Net debt / EBITDA, EV/EBITDA, FCF yield, Shareholder yield (distributions), Payout ratio (FCF).

Versus the vertical median

Beverages (SIC 2080) · same industry (4-digit SIC) · compared with 17 companies

Multiples and returns vs the median

P/E
92.4x
vertical median 30.5x
above median (+202.7%)
EV/EBITDA
—
vertical median 23.8x
P/S
8.5x
vertical median 2.0x
above median (+324.3%)
P/B
21.4x
vertical median 2.3x
above median (+840.7%)
ROE
24.0%
vertical median 11.2%
above median (+115.3%)
Net margin
9.1%
vertical median 1.5%
above median (+510.1%)
EBIT margin
15.5%
vertical median 7.2%
above median (+116.5%)
Revenue YoY
0.3%
vertical median 1.7%
below median (−84.9%)
Net debt/EBITDA
—
vertical median 2.4x
Dividend yield
—
vertical median 2.3%

Price rebased to 100 (monthly, 5 years)

Companies in the vertical

Market capP/EROENet marginRevenue YoY1A / 3A
KOCoca Cola Co412.1 bn28.242.6%28.7%+1.9%+31% / +64%
DEODIAGEO plc237.6 bn92.424.0%9.1%+0.3%+5% / −39%
PEPPepsico Inc194.1 bn18.750.1%10.8%+2.3%−4% / −15%
KDPKeurig Dr Pepper Inc.50.1 bn37.25.7%7.1%+8.2%+32% / +17%
BF-ABrown Forman Corp14.9 bn20.318.1%18.4%−1.2%+10% / −48%
PRMBPrimo Brands Corp7.6 bn79.43.2%1.5%+29.3%+34% / +46%
COCOThe Vita Coco Company, Inc.3.7 bn32.932.0%15.7%+18.2%+23% / +133%
WESTWestrock Coffee Company1.0 bn——-4.9%+39.8%+138% / +13%
BUDABuda Juice, Inc.83.2 m34.519.3%17.1%+11.8%unavailable / unavailable
SRXHSRX Global Inc.18.0 m—-70.8%-254.8%−81.3%−96% / −100%
WVVIWillamette Valley Vineyards, Inc.8.3 m—-3.3%-5.9%−6.5%−37% / −68%
YHCLQR House Inc.2.9 m0.2-88.2%-1,589.2%−37.4%−98% / −100%
IPSTIp Strategy Holdings, Inc.2.3 m—-2,713.2%-2,064.0%+20.4%−98% / unavailable
EDVAEndovia Health Sciences, Inc.1.2 m——-53,856.5%−90.9%−96% / −100%
BRCCBRC Inc.903.4 k—-14.2%-1.5%+1.7%−23% / −77%
IBGInnovation Beverage Group Limited593.4 k——-223.4%−5.1%−94% / unavailable
STZConstellation Brands, Inc.——23.9%20.9%−10.5%+7% / −40%
ABEVAmbev S.A.——16.6%17.6%−1.4%+9% / +1%

1- and 3-year price returns: for DEO from daily closes (the same as the performance table), for the other companies from month-end closes.

olivLaw engine forecast

The world engine ran after the company's latest material disclosure. Probabilities are of TOUCHING a level within the horizon (not closing there) and sit next to the random walk (p_rw), the no-information benchmark.

The engine has no published run for this company yet.

Valuation scenarios (editable assumptions)

Illustrative scenarios

Illustrative: not forecasts and without probabilities. Each case is one coherent set of assumptions, computed on today's figures.

Bear
Allowed range: -50 … 50%
Allowed range: -100 … 100%
Allowed range: 0 … 100
Allowed range: -10 … 20%
Allowed range: 0 … 100%
Base
Allowed range: -50 … 50%
Allowed range: -100 … 100%
Allowed range: 0 … 100
Allowed range: -10 … 20%
Allowed range: 0 … 100%
Bull
Allowed range: -50 … 50%
Allowed range: -100 … 100%
Allowed range: 0 … 100
Allowed range: -10 … 20%
Allowed range: 0 … 100%
Nothing is saved.

Estimated price (USD)

Estimated priceBearBaseBull
1 years
53.26
Total return -45% · Per year -45%
94.47
Total return -3% · Per year -3%
142.74
Total return 46% · Per year 46%
3 years
45.11
Total return -54% · Per year -23%
90.65
Total return -7% · Per year -2%
151.30
Total return 55% · Per year 16%
5 years
38.21
Total return -61% · Per year -17%
86.98
Total return -11% · Per year -2%
160.38
Total return 64% · Per year 10%
What moves the 3-year price the most
  • Exit P/E± 22.66
  • Net margin± 15.86
  • Annual revenue growth± 13.89
  • Annual dilution± 1.33

AI analysis

AI-generatedAI-generated analysis (Claude) from cited public sources; it may contain errors. Not investment advice. As of 27 Oct 2026 · Model: claude-haiku-5-5.

Possibly outdated: the newest document it read is from 18 Aug 2026; since then the company filed 6-K (02 Nov 2026), 6-K (13 Oct 2026), 6-K (01 Oct 2026), 6-K (30 Sept 2026), 6-K (23 Sept 2026), 6-K (01 Sept 2026).

In brief

Diageo is a global leader in beverage alcohol, with a portfolio of whisky, vodka, tequila and Guinness beer sold in nearly 180 countries. The company is in a major transformation: its new chief executive has announced a new strategy, and sales fell in the latest fiscal year, with weakness in North America while debt is being reduced. Reported net sales were 19.6 billion USD 1.

SWOT

Strengths

  • The portfolio of iconic brands and global presence across many countries form a solid base for the company 1.
  • Leadership of international spirits by retail sales value provides scale and negotiating power 1.
  • Free cash flow rose in the latest year, giving flexibility for investment and debt reduction 1.

Weaknesses

  • The company acknowledged it was not competitive enough in North America, its largest market 1.
  • Organic net sales declined in the latest fiscal year, affected by adverse mix and weaker Chinese white spirits 1.
  • Debt remains elevated, and the dividend reduction was a difficult decision for shareholders 1.

Opportunities

  • Growth in the RTD category, if captured through existing brands, could open new consumption occasions 1.
  • Restructuring savings could be reinvested in innovation and competitiveness if the plan is implemented effectively 1.
  • Guinness has, according to management, growth potential among new consumer generations 1.

Threats

  • Economic pressure on consumers could reduce spending on premium drinks 1.
  • Geopolitical and trade tensions, including tariffs, could affect costs and market access 1.
  • Regulation on alcohol consumption and shifts in behaviour could reduce volumes in some markets 1.

Risks

  • Weakness in North Americahigh

    If demand in the company's largest market remains weak, group results could stay under pressure 1.

  • Indebtednessmedium

    The debt level remains a pressure, and the reduction plan depends on completing asset sales 1.

  • Tariffs and international trademedium

    Trade tensions and tariffs could raise costs and reduce margins 1.

  • Policy on Chinese white spiritsmedium

    Government regulation in China could continue to affect results in this category 1.

  • Strategy executionmedium

    Restructuring and organisational changes could delay benefits if implementation is not effective 1.

Investment thesis

What would need to be true (bull case)

  • If the new strategy restores competitiveness in North America, the group could regain sales growth 1.
  • The broad brand portfolio and international leadership could support long-term cash generation 1.
  • Debt reduction and asset sales could give the company more flexibility for investment 1.

What would break the thesis

  • If weakness in North America persists, sales and profit could remain under pressure 1.
  • The dividend reduction could disappoint investors who sought stable income 1.
  • Restructuring costs could exceed expected benefits if savings are not delivered on time 1.

What to watch

  • Sales trend in North America and effectiveness of the new strategyFiscal 27
  • Completion of the EABL sale and the RCB cricket team stake saleCalendar H2 2026
  • Net debt to adjusted EBITDA relative to management's leverage estimateFiscal 27
  • Progress of restructuring savings and competitiveness investmentNext two years

Products, market & competition

AI-generatedAI-generated analysis (Claude) from cited public sources; it may contain errors. Not investment advice. As of 27 Oct 2026 · Model: claude-haiku-5-5.

Possibly outdated: the newest document it read is from 18 Aug 2026; since then the company filed 6-K (02 Nov 2026), 6-K (13 Oct 2026), 6-K (01 Oct 2026), 6-K (30 Sept 2026), 6-K (23 Sept 2026), 6-K (01 Sept 2026).

The business

Diageo plc is a British beverage alcohol company headquartered in London, whose portfolio includes over 200 brands, among them Johnnie Walker, Smirnoff, Guinness, Don Julio and Tanqueray 1. The company operates in five regions and 23 country or cluster organisations, with over 27,500 employees and more than 110 manufacturing sites 1. For fiscal 2026 the group reported net sales of 19.6 billion USD and reported operating profit of 3,156 million USD 1.

The strategy announced in August 2026 focuses on winning in total spirits, including ready-to-drink products, and on Guinness in premium beer 1. Management emphasised regaining competitiveness in North America, a market where the company said it had been less competitive 1. The board reduced the dividend to strengthen the balance sheet, and Diageo said it could reduce debt through the sales of EABL and the RCB cricket team stake 1.

The company said it aims to cut costs and invest mainly where it can improve competitiveness, while adjusted net debt fell and free cash flow rose in fiscal 2026 1. These changes could affect future figures if consumer markets remain fragile.

Segments

Scotch and whisky

Scotch is the largest category of Diageo, at 24% of reported net sales in fiscal 2026, alongside Canadian whisky and IMFL whisky 1. Johnnie Walker is the main brand in this category 1.

Beer

Beer, in particular Guinness, accounts for 18% of reported net sales 1. The company said Guinness has growth potential and could recruit new consumers among those of legal purchase age 1.

Tequila and vodka

Tequila, led by Don Julio, accounts for 12% of reported sales, and vodka, with Smirnoff and Ketel One, for 8% 1. Smirnoff Ice was described as the number one RTD brand in Ireland and outgrew the category in several markets 1.

Market context

The spirits category remains attractive and resilient, with growth in Europe, Latin America and Caribbean, Africa and Asia Pacific, excluding Chinese white spirits 1. However, North America remained a softer market, and economic and geopolitical uncertainty added pressure on consumer spending 1. Diageo said it is the number one international spirits business by retail sales value 1.

Growth in the RTD category and interest in low and no alcohol products are changing how consumers choose drinks 1. The company said it is watching GLP-1 medicines closely, although early data shows a smaller impact on spirits than on beer and wine 1.

Trends

  • Economic pressure on consumersheadwind

    Consumers are becoming more selective about discretionary spending, and demand in North America has remained weaker, which could limit near-term sales 1.

  • Growth of the RTD categorytailwind

    Ready-to-drink products are increasingly important to how consumers engage with brands, being portable and good value 1. If these products attract new consumers, they could support group growth 1.

  • More nuanced premiumisationmixed

    The company said it must grow premium and luxury where opportunities exist, while using the full price and format ladder of its portfolio 1. This approach could support sales if applied effectively 1.

  • Trade tensions and regulationheadwind

    Government policy on Chinese white spirits and tensions in global trade affected results, and tariffs reduced operating margin 1. These pressures could persist if they continue 1.

Competitive position

Diageo compares itself with other international spirits producers, which it surpasses in size, particularly in whisky and tequila categories 1. Competition also includes local and regional producers, and Diageo said it must recover competitiveness in North America 1.

Over the last year, the company said some brands grew faster than the category, but the portfolio as a whole needs strengthening 1. The new strategy aims to respond better to competition through pricing, formats and customer partnerships 1.

  • Pernod Ricard

    International spirits competitor referenced in the source as a point of size comparison for the group 1.

  • Bacardi

    Rum and spirits producer present in international markets where it competes with Diageo 1.

  • Brown-FormanBF.B

    American whiskey producer active in bourbon and tequila, in direct competition in North America 1.

  • Heineken

    International beer producer competing with Guinness in the premium beer segment 1.

News & filings

In the press

The latest news item in our archive is from 26 Oct 2026; the newest SEC filing is from 02 Nov 2026. The press archive comes from the RSS feeds we follow and does not necessarily cover the latest event — the filings alongside do.

Sources

  1. [1] Form 20-F, fiscal year ended 2026-06-30 · SEC / Diageo plc · 18 Aug 2026

Figures computed by olivLaw from SEC filings and closing prices; the qualitative analysis is AI-generated from cited sources. Not investment advice.