DIAGEO PLC-SPONSORED ADR (DEO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DEO - US25243Q2057 - ADR
88.56 USD
-0.79 (-0.88%)
88.72 USD
+0.16 (+0.18%)
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 has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- In the past year DEO was profitable.
- In the past year DEO had a positive cash flow from operations.
- Each year in the past 5 years DEO has been profitable.
- Each year in the past 5 years DEO had a positive operating cash flow.
1.2 Ratios
- DEO has a Return On Assets (4.77%) which is in line with 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.
- Measured over the past 3 years, the Average Return On Invested Capital 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.
- In the last couple of years the Profit Margin of DEO has remained more or less at the same level.
- DEO has a better Operating Margin (21.41%) than 75.76% of its industry peers.
- In the last couple of years the Operating Margin of DEO has declined.
- Looking at the Gross Margin, with a value of 60.13%, DEO belongs to the top of the industry, outperforming 87.88% of the companies in the same industry.
- DEO's Gross Margin has been stable in the last couple of years.
| 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
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), DEO is creating some value.
- DEO has about the same amout of shares outstanding than it did 1 year ago.
- DEO has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, DEO has a worse debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 2.05 indicates that DEO is not a great score, but indicates only limited risk for bankruptcy at the moment.
- With a Altman-Z score value of 2.05, DEO perfoms like the industry average, outperforming 48.48% of the companies in the same industry.
- The Debt to FCF ratio of DEO is 8.78, which is on the high side as it means it would take DEO, 8.78 years of fcf income to pay off all of its debts.
- DEO has a Debt to FCF ratio of 8.78. This is comparable to the rest of the industry: DEO outperforms 42.42% of its industry peers.
- DEO has a Debt/Equity ratio of 1.88. This is a high value indicating a heavy dependency on external financing.
- DEO has a Debt to Equity ratio of 1.88. This is amonst the worse of the industry: DEO underperforms 87.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.88 | ||
| Debt/FCF | 8.78 | ||
| Altman-Z | 2.05 |
ROIC/WACC1.13
WACC7.34%
2.3 Liquidity
- A Current Ratio of 1.63 indicates that DEO should not have too much problems paying 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.
- A Quick Ratio of 0.64 indicates that DEO may have some problems paying 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.
- DEO shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 3.59% yearly.
- The Revenue has decreased by -0.12% in the past year.
- DEO shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 11.49% yearly.
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
- DEO is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.84% yearly.
- 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
- With a Price/Earnings ratio of 13.50, DEO is valued correctly.
- Based on the Price/Earnings ratio, DEO is valued a bit cheaper than the industry average as 78.79% of the companies are valued more expensively.
- DEO's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.47.
- DEO is valuated correctly with a Price/Forward Earnings ratio of 13.11.
- Based on the Price/Forward Earnings ratio, DEO is valued a bit cheaper than the industry average as 75.76% of the companies are valued more expensively.
- DEO's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.26.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.5 | ||
| Fwd PE | 13.11 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DEO indicates a somewhat cheap valuation: DEO is cheaper than 63.64% of the companies listed in the same industry.
- 72.73% of the companies in the same industry are more expensive than DEO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.19 | ||
| EV/EBITDA | 11.52 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- The decent profitability rating of DEO may justify a higher PE ratio.
PEG (NY)4.54
PEG (5Y)3.76
EPS Next 2Y4.21%
EPS Next 3Y5%
5. Dividend
5.1 Amount
- DEO has a Yearly Dividend Yield of 4.73%, which is a nice return.
- Compared to an average industry Dividend Yield of 1.73, DEO pays a better dividend. On top of this DEO pays more dividend than 96.97% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.87, DEO pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.73% |
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.
- The dividend of DEO decreased 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%
88.56
-0.79 (-0.88%)
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 Cap49.23B
Revenue(TTM)20.25B
Net Income(TTM)2.35B
Analysts76.13
Price Target119.04 (34.42%)
Short Float %0.36%
Short Ratio1.23
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.73% |
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)0.39%
PT rev (3m)-5.36%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-0.29%
EPS NY rev (3m)-4.01%
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 | 13.5 | ||
| Fwd PE | 13.11 | ||
| P/S | 2.43 | ||
| P/FCF | 18.19 | ||
| P/OCF | 11.4 | ||
| P/B | 4.44 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.52 |
EPS(TTM)6.56
EY7.41%
EPS(NY)6.76
Fwd EY7.63%
FCF(TTM)4.87
FCFY5.5%
OCF(TTM)7.77
OCFY8.77%
SpS36.42
BVpS19.95
TBVpS-6.63
PEG (NY)4.54
PEG (5Y)3.76
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 | 2.05 |
F-Score4
WACC7.34%
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%.