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Diageo

GUI.DE
48
Beverages - Alcoholic · Consumer Defensive
Exchange
Frankfurt Stock Exchange
Winston Score
48
Winston is serious
Mixed quality — meaningful strengths and weaknesses.
Data as of Aug 23, 2026 · filings through Jun 30, 2026
How the score breaks down
Quality
Strong
Growth
Weak
Cash Flow
Exceptional
Stability
Mixed
Valuation
Strong
Dividends
Weak

Winston Score History

The full picture

Diageo is one of the world's largest producers of alcoholic drinks. It owns well-known brands like Johnnie Walker whisky, Guinness beer, Smirnoff vodka, Tanqueray gin, and Captain Morgan rum. The company sells to bars, restaurants, retailers, and everyday consumers across the globe.

Diageo makes money by selling its branded spirits, beer, and ready-to-drink products to distributors and retailers, who then sell them to customers. It operates in over 180 countries, with strong sales in North America, Europe, Africa, and Asia. Its main competitive advantage is its large portfolio of trusted, premium brands that are difficult for competitors to replicate. The key risk is that consumers are drinking less alcohol overall, a trend that has been pressuring sales volumes in recent years, particularly in the United States and Latin America.

Score breakdown

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Quality

Profit per sale
Gross Margin
57.7%
Premium pricing power — 57.7% gross margin
Profit after running costs
Operating Margin
25.2%
Excellent — 25.2% operating margin
Return on the money invested
ROCE
17.0%
Strong — 17.0% return on capital

ROIC between 15% and 25%. Every dollar invested in the business earns 15 to 25 cents back per year.

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Growth

Sales growth
Sales YoY
-25.8%
Shrinking sales (-25.8% YoY)
Profit growth
EPS YoY
-41.5%
Earnings shrinking (-41.5% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

How steady the profit is
EPS Consistency
4/8 quarters
Earnings inconsistent quarter-to-quarter

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Cash Flow

Profit that turns into cash
Cash Conversion
249%
Turns 249% of profit into real cash
Spare cash per sale
FCF Margin
16.2%
Converts sales into free cash efficiently (16.2%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

What it owes vs what it owns
Debt / Equity
2.00
Heavy debt load (2.00)
Covers its interest
Interest Cover
5.28x
Adequate interest coverage (5.3x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

Price vs profit
P/E Ratio (TTM)
25.4x
no trend
Growth-priced — P/E 25.4

P/E above the market average. People are paying up for expected growth.

Cheaper or dearer next year
P/E vs Forward
+8.4
GROWING
Earnings expected to grow meaningfully — cheaper on forward P/E (25.4 → 17.0)

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Dividends

Dividend
Dividend Yield
1.71%
no trend
Small dividend — 1.71% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend record
Dividend Growth
-2.1%
no trend
Dividend cut (-2.1% YoY) — warning sign

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