DIAGEO PLC-SPONSORED ADR (DEO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DEO - US25243Q2057 - ADR
91.37 USD
+1.44 (+1.6%)
91.37 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to DEO. DEO was compared to 33 industry peers in the Beverages industry. DEO has a medium profitability rating, but doesn't score so well on its financial health evaluation. DEO is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- DEO had positive earnings in the past year.
- In the past year DEO had a positive cash flow from operations.
- In the past 5 years DEO has always been profitable.
- DEO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- DEO's Return On Assets of 4.77% is in line compared to the rest of the industry. DEO outperforms 51.52% of its industry peers.
- DEO's Return On Equity of 21.23% is fine compared to the rest of the industry. DEO outperforms 72.73% of its industry peers.
- DEO has a Return On Invested Capital (8.31%) which is comparable to the rest of the industry.
- The Average Return On Invested Capital over the past 3 years for DEO is in line with the industry average of 11.45%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.77% | ||
| ROE | 21.23% | ||
| ROIC | 8.31% |
ROA(3y)7.73%
ROA(5y)8.08%
ROE(3y)34.97%
ROE(5y)37.03%
ROIC(3y)11.21%
ROIC(5y)11.47%
1.3 Margins
- Looking at the Profit Margin, with a value of 11.63%, DEO is in the better half of the industry, outperforming 72.73% of the companies in the same industry.
- DEO's Profit Margin has been stable in the last couple of years.
- Looking at the Operating Margin, with a value of 21.41%, DEO is in the better half of the industry, outperforming 75.76% of the companies in the same industry.
- In the last couple of years the Operating Margin of DEO has declined.
- DEO's Gross Margin of 60.13% is amongst the best of the industry. DEO outperforms 87.88% of its industry peers.
- In the last couple of years the Gross Margin of DEO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.41% | ||
| PM (TTM) | 11.63% | ||
| GM | 60.13% |
OM growth 3Y-11.65%
OM growth 5Y-6.79%
PM growth 3Y-17.92%
PM growth 5Y-0.61%
GM growth 3Y-0.67%
GM growth 5Y-0.09%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so DEO is still creating some value.
- The number of shares outstanding for DEO remains at a similar level compared to 1 year ago.
- Compared to 5 years ago, DEO has less shares outstanding
- Compared to 1 year ago, DEO has a worse debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 2.06 indicates that DEO is not a great score, but indicates only limited risk for bankruptcy at the moment.
- The Altman-Z score of DEO (2.06) is comparable to the rest of the industry.
- DEO has a debt to FCF ratio of 8.78. This is a slightly negative value and a sign of low solvency as DEO would need 8.78 years to pay back of all of its debts.
- DEO's Debt to FCF ratio of 8.78 is in line compared to the rest of the industry. DEO outperforms 42.42% of its industry peers.
- A Debt/Equity ratio of 1.88 is on the high side and indicates that DEO has dependencies on debt financing.
- The Debt to Equity ratio of DEO (1.88) is worse than 87.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.88 | ||
| Debt/FCF | 8.78 | ||
| Altman-Z | 2.06 |
ROIC/WACC1.13
WACC7.38%
2.3 Liquidity
- DEO has a Current Ratio of 1.63. This is a normal value and indicates that DEO is financially healthy and should not expect problems in meeting its short term obligations.
- DEO's Current ratio of 1.63 is fine compared to the rest of the industry. DEO outperforms 60.61% of its industry peers.
- DEO has a Quick Ratio of 1.63. This is a bad value and indicates that DEO is not financially healthy enough and could expect problems in meeting its short term obligations.
- DEO's Quick ratio of 0.64 is on the low side compared to the rest of the industry. DEO is outperformed by 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.63 | ||
| Quick Ratio | 0.64 |
3. Growth
3.1 Past
- The earnings per share for DEO have decreased by -8.65% in the last year.
- Measured over the past 5 years, DEO shows a small growth in Earnings Per Share. The EPS has been growing by 3.59% on average per year.
- DEO shows a decrease in Revenue. In the last year, the revenue decreased by -0.12%.
- Measured over the past years, DEO shows a quite strong growth in Revenue. The Revenue has been growing by 11.49% on average per year.
EPS 1Y (TTM)-8.65%
EPS 3Y-6.76%
EPS 5Y3.59%
EPS Q2Q%-7.14%
Revenue 1Y (TTM)-0.12%
Revenue growth 3Y-1.08%
Revenue growth 5Y11.49%
Sales Q2Q%-3.34%
3.2 Future
- Based on estimates for the next years, DEO will show a small growth in Earnings Per Share. The EPS will grow by 6.84% on average per year.
- Based on estimates for the next years, DEO will show a small growth in Revenue. The Revenue will grow by 2.42% on average per year.
EPS Next Y2.98%
EPS Next 2Y4.21%
EPS Next 3Y5%
EPS Next 5Y6.84%
Revenue Next Year-3.03%
Revenue Next 2Y0.1%
Revenue Next 3Y1.32%
Revenue Next 5Y2.42%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 13.93, the valuation of DEO can be described as correct.
- Based on the Price/Earnings ratio, DEO is valued a bit cheaper than 75.76% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 27.33. DEO is valued slightly cheaper when compared to this.
- The Price/Forward Earnings ratio is 13.52, which indicates a correct valuation of DEO.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of DEO indicates a somewhat cheap valuation: DEO is cheaper than 75.76% of the companies listed in the same industry.
- DEO's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.12.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.93 | ||
| Fwd PE | 13.52 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, DEO is valued a bit cheaper than 63.64% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of DEO indicates a somewhat cheap valuation: DEO is cheaper than 72.73% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.77 | ||
| EV/EBITDA | 11.64 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates DEO does not grow enough to justify the current Price/Earnings ratio.
- The decent profitability rating of DEO may justify a higher PE ratio.
PEG (NY)4.68
PEG (5Y)3.88
EPS Next 2Y4.21%
EPS Next 3Y5%
5. Dividend
5.1 Amount
- DEO has a Yearly Dividend Yield of 4.96%, which is a nice return.
- DEO's Dividend Yield is rather good when compared to the industry average which is at 1.77. DEO pays more dividend than 96.97% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.91, DEO pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.96% |
5.2 History
- The dividend of DEO is nicely growing with an annual growth rate of 8.14%!
- DEO has been paying a dividend for at least 10 years, so it has a reliable track record.
- DEO has decreased its dividend in the last 3 years.
Dividend Growth(5Y)8.14%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
- 97.62% of the earnings are spent on dividend by DEO. This is not a sustainable payout ratio.
- DEO's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP97.62%
EPS Next 2Y4.21%
EPS Next 3Y5%
91.37
+1.44 (+1.6%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)11-06 2025-11-06
Earnings (Next)02-25 2026-02-25
Inst Owners64.39%
Inst Owner Change-0.18%
Ins Owners0.06%
Ins Owner ChangeN/A
Market Cap50.79B
Revenue(TTM)20.25B
Net Income(TTM)2.35B
Analysts76.13
Price Target116.93 (27.97%)
Short Float %0.36%
Short Ratio1.23
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.96% |
Yearly Dividend1.03
Dividend Growth(5Y)8.14%
DP97.62%
Div Incr Years2
Div Non Decr Years2
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-1.39%
PT rev (3m)-7.04%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-0.29%
EPS NY rev (3m)-4.06%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.19%
Revenue NY rev (3m)-3.82%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.93 | ||
| Fwd PE | 13.52 | ||
| P/S | 2.51 | ||
| P/FCF | 18.77 | ||
| P/OCF | 11.76 | ||
| P/B | 4.58 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.64 |
EPS(TTM)6.56
EY7.18%
EPS(NY)6.76
Fwd EY7.4%
FCF(TTM)4.87
FCFY5.33%
OCF(TTM)7.77
OCFY8.5%
SpS36.42
BVpS19.95
TBVpS-6.63
PEG (NY)4.68
PEG (5Y)3.88
Graham Number54.27
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.77% | ||
| ROE | 21.23% | ||
| ROCE | 11.23% | ||
| ROIC | 8.31% | ||
| ROICexc | 8.94% | ||
| ROICexgc | 15.19% | ||
| OM | 21.41% | ||
| PM (TTM) | 11.63% | ||
| GM | 60.13% | ||
| FCFM | 13.37% |
ROA(3y)7.73%
ROA(5y)8.08%
ROE(3y)34.97%
ROE(5y)37.03%
ROIC(3y)11.21%
ROIC(5y)11.47%
ROICexc(3y)11.83%
ROICexc(5y)12.24%
ROICexgc(3y)20.56%
ROICexgc(5y)21.89%
ROCE(3y)15.27%
ROCE(5y)15.6%
ROICexgc growth 3Y-14.98%
ROICexgc growth 5Y-6.83%
ROICexc growth 3Y-12.89%
ROICexc growth 5Y-4.5%
OM growth 3Y-11.65%
OM growth 5Y-6.79%
PM growth 3Y-17.92%
PM growth 5Y-0.61%
GM growth 3Y-0.67%
GM growth 5Y-0.09%
F-Score4
Asset Turnover0.41
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.88 | ||
| Debt/FCF | 8.78 | ||
| Debt/EBITDA | 3.44 | ||
| Cap/Depr | 93.83% | ||
| Cap/Sales | 7.96% | ||
| Interest Coverage | 4.42 | ||
| Cash Conversion | 71.34% | ||
| Profit Quality | 114.95% | ||
| Current Ratio | 1.63 | ||
| Quick Ratio | 0.64 | ||
| Altman-Z | 2.06 |
F-Score4
WACC7.38%
ROIC/WACC1.13
Cap/Depr(3y)169.79%
Cap/Depr(5y)156.38%
Cap/Sales(3y)7.44%
Cap/Sales(5y)6.86%
Profit Quality(3y)77.05%
Profit Quality(5y)86.47%
High Growth Momentum
Growth
EPS 1Y (TTM)-8.65%
EPS 3Y-6.76%
EPS 5Y3.59%
EPS Q2Q%-7.14%
EPS Next Y2.98%
EPS Next 2Y4.21%
EPS Next 3Y5%
EPS Next 5Y6.84%
Revenue 1Y (TTM)-0.12%
Revenue growth 3Y-1.08%
Revenue growth 5Y11.49%
Sales Q2Q%-3.34%
Revenue Next Year-3.03%
Revenue Next 2Y0.1%
Revenue Next 3Y1.32%
Revenue Next 5Y2.42%
EBIT growth 1Y-27.08%
EBIT growth 3Y-12.6%
EBIT growth 5Y3.92%
EBIT Next Year12.59%
EBIT Next 3Y7.32%
EBIT Next 5Y4.43%
FCF growth 1Y5.5%
FCF growth 3Y-11.02%
FCF growth 5Y10.81%
OCF growth 1Y5.96%
OCF growth 3Y-6.76%
OCF growth 5Y13.23%
DIAGEO PLC-SPONSORED ADR / DEO FAQ
What is the fundamental rating for DEO stock?
ChartMill assigns a fundamental rating of 5 / 10 to DEO.
Can you provide the valuation status for DIAGEO PLC-SPONSORED ADR?
ChartMill assigns a valuation rating of 5 / 10 to DIAGEO PLC-SPONSORED ADR (DEO). This can be considered as Fairly Valued.
Can you provide the profitability details for DIAGEO PLC-SPONSORED ADR?
DIAGEO PLC-SPONSORED ADR (DEO) has a profitability rating of 6 / 10.
How financially healthy is DIAGEO PLC-SPONSORED ADR?
The financial health rating of DIAGEO PLC-SPONSORED ADR (DEO) is 3 / 10.
Is the dividend of DIAGEO PLC-SPONSORED ADR sustainable?
The dividend rating of DIAGEO PLC-SPONSORED ADR (DEO) is 6 / 10 and the dividend payout ratio is 97.62%.