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DIAGEO PLC-SPONSORED ADR (DEO) Stock Fundamental Analysis

NYSE:DEO - New York Stock Exchange, Inc. - US25243Q2057 - ADR - Currency: USD

104.73  -0.26 (-0.25%)

After market: 104.73 0 (0%)

Fundamental Rating

5

Overall DEO gets a fundamental rating of 5 out of 10. We evaluated DEO against 32 industry peers in the Beverages industry. DEO has an excellent profitability rating, but there are concerns on its financial health. DEO has a valuation in line with the averages, but it does not seem to be growing.


Dividend Valuation Growth Profitability Health

7

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.
In the past 5 years DEO has always been profitable.
DEO had a positive operating cash flow in each of the past 5 years.
DEO Yearly Net Income VS EBIT VS OCF VS FCFDEO Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B

1.2 Ratios

DEO has a Return On Assets of 7.66%. This is in the better half of the industry: DEO outperforms 62.50% of its industry peers.
Looking at the Return On Equity, with a value of 34.96%, DEO belongs to the top of the industry, outperforming 87.50% of the companies in the same industry.
With a decent Return On Invested Capital value of 12.39%, DEO is doing good in the industry, outperforming 68.75% of the companies in the same industry.
DEO had an Average Return On Invested Capital over the past 3 years of 13.30%. This is in line with the industry average of 11.61%.
Industry RankSector Rank
ROA 7.66%
ROE 34.96%
ROIC 12.39%
ROA(3y)9.1%
ROA(5y)7.97%
ROE(3y)41.78%
ROE(5y)36.94%
ROIC(3y)13.3%
ROIC(5y)12.38%
DEO Yearly ROA, ROE, ROICDEO Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10 20 30 40

1.3 Margins

DEO has a Profit Margin of 17.79%. This is amongst the best in the industry. DEO outperforms 87.50% of its industry peers.
DEO's Profit Margin has declined in the last couple of years.
DEO's Operating Margin of 28.74% is amongst the best of the industry. DEO outperforms 90.63% of its industry peers.
DEO's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 60.45%, DEO belongs to the top of the industry, outperforming 90.63% of the companies in the same industry.
DEO's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 28.74%
PM (TTM) 17.79%
GM 60.45%
OM growth 3Y-0.1%
OM growth 5Y-1.72%
PM growth 3Y-2.95%
PM growth 5Y-4.91%
GM growth 3Y-0.14%
GM growth 5Y-0.65%
DEO Yearly Profit, Operating, Gross MarginsDEO Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 20 40 60

3

2. Health

2.1 Basic Checks

DEO has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
DEO has less 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.
DEO Yearly Shares OutstandingDEO Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 200M 400M 600M
DEO Yearly Total Debt VS Total AssetsDEO Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10B 20B 30B 40B

2.2 Solvency

An Altman-Z score of 2.39 indicates that DEO is not a great score, but indicates only limited risk for bankruptcy at the moment.
DEO's Altman-Z score of 2.39 is in line compared to the rest of the industry. DEO outperforms 50.00% of its industry peers.
The Debt to FCF ratio of DEO is 8.05, which is on the high side as it means it would take DEO, 8.05 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 8.05, DEO is in line with its industry, outperforming 53.13% of the companies in the same industry.
A Debt/Equity ratio of 1.87 is on the high side and indicates that DEO has dependencies on debt financing.
DEO has a Debt to Equity ratio of 1.87. This is amonst the worse of the industry: DEO underperforms 84.38% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.87
Debt/FCF 8.05
Altman-Z 2.39
ROIC/WACC1.62
WACC7.67%
DEO Yearly LT Debt VS Equity VS FCFDEO Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B 20B

2.3 Liquidity

A Current Ratio of 1.60 indicates that DEO should not have too much problems paying its short term obligations.
The Current ratio of DEO (1.60) is comparable to the rest of the industry.
A Quick Ratio of 0.67 indicates that DEO may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.67, DEO is in line with its industry, outperforming 43.75% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.6
Quick Ratio 0.67
DEO Yearly Current Assets VS Current LiabilitesDEO Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B

3

3. Growth

3.1 Past

DEO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -10.02%.
Measured over the past 5 years, DEO shows a small growth in Earnings Per Share. The EPS has been growing by 6.58% on average per year.
Looking at the last year, DEO shows a decrease in Revenue. The Revenue has decreased by -0.93% in the last year.
Measured over the past years, DEO shows a quite strong growth in Revenue. The Revenue has been growing by 9.51% on average per year.
EPS 1Y (TTM)-10.02%
EPS 3Y9.77%
EPS 5Y6.58%
EPS Q2Q%-9.65%
Revenue 1Y (TTM)-0.93%
Revenue growth 3Y7.38%
Revenue growth 5Y9.51%
Sales Q2Q%-0.56%

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 4.61% on average per year.
Based on estimates for the next years, DEO will show a small growth in Revenue. The Revenue will grow by 3.59% on average per year.
EPS Next Y-7.36%
EPS Next 2Y-0.97%
EPS Next 3Y1.85%
EPS Next 5Y4.61%
Revenue Next Year0.13%
Revenue Next 2Y1.5%
Revenue Next 3Y2.5%
Revenue Next 5Y3.59%

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 decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
DEO Yearly Revenue VS EstimatesDEO Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 10B 20B 30B
DEO Yearly EPS VS EstimatesDEO Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2 4 6 8 10

5

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 15.47, which indicates a correct valuation of DEO.
Based on the Price/Earnings ratio, DEO is valued cheaply inside the industry as 81.25% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 27.45, DEO is valued a bit cheaper.
A Price/Forward Earnings ratio of 14.86 indicates a correct valuation of DEO.
84.38% of the companies in the same industry are more expensive than DEO, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 21.90. DEO is valued slightly cheaper when compared to this.
Industry RankSector Rank
PE 15.47
Fwd PE 14.86
DEO Price Earnings VS Forward Price EarningsDEO Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

DEO's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, DEO is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 21.57
EV/EBITDA 12.38
DEO Per share dataDEO EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 10 20 30

4.3 Compensation for Growth

The decent profitability rating of DEO may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.35
EPS Next 2Y-0.97%
EPS Next 3Y1.85%

6

5. Dividend

5.1 Amount

DEO has a Yearly Dividend Yield of 4.30%, which is a nice return.
DEO's Dividend Yield is rather good when compared to the industry average which is at 3.13. DEO pays more dividend than 90.63% of the companies in the same industry.
DEO's Dividend Yield is rather good when compared to the S&P500 average which is at 2.42.
Industry RankSector Rank
Dividend Yield 4.3%

5.2 History

On average, the dividend of DEO grows each year by 8.40%, which is quite nice.
DEO has paid a dividend for at least 10 years, which is a reliable track record.
DEO has decreased its dividend in the last 3 years.
Dividend Growth(5Y)8.4%
Div Incr Years2
Div Non Decr Years2
DEO Yearly Dividends per shareDEO Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1 2 3 4

5.3 Sustainability

DEO pays out 63.78% of its income as dividend. This is not a sustainable payout ratio.
DEO's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP63.78%
EPS Next 2Y-0.97%
EPS Next 3Y1.85%
DEO Yearly Income VS Free CF VS DividendDEO Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B
DEO Dividend Payout.DEO Dividend Payout, showing the Payout Ratio.DEO Dividend Payout.PayoutRetained Earnings

DIAGEO PLC-SPONSORED ADR

NYSE:DEO (7/3/2025, 7:17:26 PM)

After market: 104.73 0 (0%)

104.73

-0.26 (-0.25%)

Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)05-19 2025-05-19
Earnings (Next)08-05 2025-08-05/amc
Inst Owners59.21%
Inst Owner Change-17.66%
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap58.19B
Analysts75.15
Price Target132.75 (26.75%)
Short Float %0.09%
Short Ratio0.62
Dividend
Industry RankSector Rank
Dividend Yield 4.3%
Yearly Dividend1.01
Dividend Growth(5Y)8.4%
DP63.78%
Div Incr Years2
Div Non Decr Years2
Ex-Date02-28 2025-02-28 (1.62)
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)-5.44%
PT rev (3m)-5.41%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)-0.39%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.07%
Valuation
Industry RankSector Rank
PE 15.47
Fwd PE 14.86
P/S 2.88
P/FCF 21.57
P/OCF 13.66
P/B 5.66
P/tB N/A
EV/EBITDA 12.38
EPS(TTM)6.77
EY6.46%
EPS(NY)7.05
Fwd EY6.73%
FCF(TTM)4.86
FCFY4.64%
OCF(TTM)7.66
OCFY7.32%
SpS36.37
BVpS18.51
TBVpS-8.06
PEG (NY)N/A
PEG (5Y)2.35
Profitability
Industry RankSector Rank
ROA 7.66%
ROE 34.96%
ROCE 15.92%
ROIC 12.39%
ROICexc 13.1%
ROICexgc 22.91%
OM 28.74%
PM (TTM) 17.79%
GM 60.45%
FCFM 13.35%
ROA(3y)9.1%
ROA(5y)7.97%
ROE(3y)41.78%
ROE(5y)36.94%
ROIC(3y)13.3%
ROIC(5y)12.38%
ROICexc(3y)14.04%
ROICexc(5y)13.35%
ROICexgc(3y)24.95%
ROICexgc(5y)24.37%
ROCE(3y)17.22%
ROCE(5y)16.02%
ROICexcg growth 3Y-1.37%
ROICexcg growth 5Y-3.39%
ROICexc growth 3Y1.39%
ROICexc growth 5Y0.11%
OM growth 3Y-0.1%
OM growth 5Y-1.72%
PM growth 3Y-2.95%
PM growth 5Y-4.91%
GM growth 3Y-0.14%
GM growth 5Y-0.65%
F-Score7
Asset Turnover0.43
Health
Industry RankSector Rank
Debt/Equity 1.87
Debt/FCF 8.05
Debt/EBITDA 3.06
Cap/Depr 331.21%
Cap/Sales 7.72%
Interest Coverage 5.43
Cash Conversion 67.82%
Profit Quality 75.05%
Current Ratio 1.6
Quick Ratio 0.67
Altman-Z 2.39
F-Score7
WACC7.67%
ROIC/WACC1.62
Cap/Depr(3y)182.68%
Cap/Depr(5y)145.23%
Cap/Sales(3y)7.15%
Cap/Sales(5y)6.46%
Profit Quality(3y)67.85%
Profit Quality(5y)86.47%
High Growth Momentum
Growth
EPS 1Y (TTM)-10.02%
EPS 3Y9.77%
EPS 5Y6.58%
EPS Q2Q%-9.65%
EPS Next Y-7.36%
EPS Next 2Y-0.97%
EPS Next 3Y1.85%
EPS Next 5Y4.61%
Revenue 1Y (TTM)-0.93%
Revenue growth 3Y7.38%
Revenue growth 5Y9.51%
Sales Q2Q%-0.56%
Revenue Next Year0.13%
Revenue Next 2Y1.5%
Revenue Next 3Y2.5%
Revenue Next 5Y3.59%
EBIT growth 1Y-3.52%
EBIT growth 3Y7.27%
EBIT growth 5Y7.63%
EBIT Next Year10.13%
EBIT Next 3Y6.69%
EBIT Next 5Y3.77%
FCF growth 1Y24.1%
FCF growth 3Y-12.98%
FCF growth 5Y-0.09%
OCF growth 1Y25.12%
OCF growth 3Y-4.63%
OCF growth 5Y4.64%