DEO Stock Analysis: Buy, Sell, or Hold?
DEO - Diageo plc
$74.63
0.18 (0.24%)
ā²
5d:
+0.78%
30d:
-11.28%
90d:
-13.82%
BUY
HIGH Confidence
Analysis Updated: Apr 1, 2026 12:00 AM ET
Earnings: Jun 03, 2026
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Interactive Price Chart (1 Month)
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Bottom Line:
ā BUY SIGNAL: DEO trading at deep discount. Market pricing in -4.4% annual earnings decline, creating value opportunity for patient investors.
ā BUY SIGNAL: DEO trading at deep discount. Market pricing in -4.4% annual earnings decline, creating value opportunity for patient investors.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$28.67
Based on -18.1% avg growth
INTRINSIC VALUE TODAY
$17.80
Trading above fair value
How this is calculated: We use a Growth Decay Model: starting with analyst consensus growth (adjusted above) and gradually slowing it down to a long-term terminal rate (4%) by Year 5. This provides a more realistic valuation than assuming constant hyper-growth. We then apply a 13.2x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: DEO is currently trading at $74.63, which is considered slightly low relative to its 30-day fair value range of $72.75 to $87.65. From a valuation perspective, the stock is trading at a discount (Forward PE: 11.6) compared to its historical average (13.2). Remarkably, the market is currently pricing in an annual earnings decline of 4.4% over the next few years. This pessimistic expectation contrasts with the company's recent 2.9% earnings growth, suggesting potential undervaluation if the company simply maintains stability.
Technical Outlook: Technically, DEO is in a downtrend. The price is currently testing key support at $72.45. A bounce from this level would confirm strength, while a break below could signal further downside.
Market Sentiment: The stock shows a mixed technical setup (45/100), with neutral trendline and momentum signals. Wall Street analysts see significant upside, with an average price target of $105.29 (+41.1%). Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Technical Outlook: Technically, DEO is in a downtrend. The price is currently testing key support at $72.45. A bounce from this level would confirm strength, while a break below could signal further downside.
Market Sentiment: The stock shows a mixed technical setup (45/100), with neutral trendline and momentum signals. Wall Street analysts see significant upside, with an average price target of $105.29 (+41.1%). Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Quick Decision Summary
Current Position
SLIGHTLY LOW
Fair Price Range
$72.75 -
$87.65
Company Quality Score
53/100
(HOLD)
Volume Confirmation
HIGH
Confidence Score
79.5%
All Signals
- BULLISH: Price oversold vs 30-day range
- NEUTRAL: Mixed technical signals (45/100)
- BULLISH: High volume confirmation
- BULLISH: Trading 41.1% below Wall St target ($105.29)
Fair Price Analysis
30-Day Fair Range
$72.75 -
$87.65
Current vs Fair Value
SLIGHTLY LOW
Support & Resistance Levels
Support Level
$72.45
Resistance Level
$75.51
Current Trend
Downtrend
Technical data as of
Apr 1, 2026
Fundamental Context
Forward P/E (Next Year Est.)
11.57
Wall Street Target
$105.29
(+41.1%)
Revenue Growth (YoY)
-4.0%
Earnings Growth (YoY)
2.9%
Profit Margin
12.2%
Valuation Discount vs History
-4.4% cheaper
PE vs Historical
11.6 vs 13.2
CHEAP
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
-4.4%
(market-implied from PE analysis)
1-Year Target
$71.35
(-4%)
2-Year Target
$68.21
(-9%)
3-Year Target
$65.21
(-13%)
3-Yr Target (if PE normalizes)
(PE: 12ā13)
$74.42
(0%)
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 22.4, Growth: -40.1%)
$142.49
(+91%)
Base:
(SPY PE: 11.6, Growth: -40.1%)
$73.74
(-1%)
Bear:
(PE: 9.8, Growth: -40.1%)
$62.67
(-16%)
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Valuation based on Current Earnings
RECOVERY PLAY: Stock looks expensive now (17x PE), but valuation improves significantly next year (12x PE) as earnings recover.
Trailing PE: 17.06 | Current EPS (TTM): $4.33
Bull Case
$121.09
(+63%)
Analyst growth 49.0%, PE expands to 18.8
Base Case
$110.08
(+49%)
Market implied 49.0%, PE stable at 17.1
Bear Case
$50.23
(-32%)
Severe decline -20.0%, PE contracts to 14.5
These are projections based on PE multiples and EPS growth scenarios, not predictions. Actual results may vary significantly.
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Upside Surprise Potential
If earnings stabilize (0% growth), PE could expand from 11.6 to 13.2
Stabilization Target:
$85.18
(+14.1%)
PE Expansion Potential:
+14.1%
Share & Embed Analysis
Last updated: April 02, 2026 7:17 AM ET
Data refreshes hourly during market hours. Next update: 8:17 AM
Data refreshes hourly during market hours. Next update: 8:17 AM
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Technical Signals Check
Is DEO showing a specific setup today?
Insider Activity (6 Months)
0
Buys
0
Sells
0
Net
NEUTRAL
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