Update shared on03 Sep 2025
Fair value Increased 1.03%Diageo’s future P/E multiple has materially declined from 19.89x to 14.90x, indicating a notable improvement in valuation against steady revenue growth expectations, resulting in a marginal analyst price target increase from £23.29 to £23.54.
What's in the News
- Diageo will close its Amherstburg, Ontario bottling facility by February 2026 as part of a supply chain optimization effort; Crown Royal production in Canada remains unaffected, with bottling shifting closer to U.S. consumers.
- Fiscal 2026 earnings guidance calls for organic net sales growth similar to 2025, with more growth expected in the second half; mid-single-digit organic operating profit growth targeted, supported by Accelerate program cost savings and consideration of tariff impacts.
- Deirdre Mahlan appointed Interim CFO effective in August 2025, bringing extensive prior experience as Diageo CFO (2010-2015) and in the consumer goods sector.
- Debra Crew stepped down as CEO, with CFO Nik Jhangiani named Interim CEO; a formal search is underway for a permanent replacement.
- Diageo is reportedly considering strategic options, including sale of part or all of its stake in IPL cricket franchise Royal Challengers Bengaluru (RCB), but both Diageo and United Spirits have publicly denied current sale discussions, calling such reports speculative.
Valuation Changes
Summary of Valuation Changes for Diageo
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from £23.29 to £23.54.
- The Future P/E for Diageo has significantly fallen from 19.89x to 14.90x.
- The Consensus Revenue Growth forecasts for Diageo remained effectively unchanged, at 2.7% per annum.
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