Diageo Share Discussion Threads

[betman] 26/6/2008 09:04

should be a trading statement pre close this week, which if 9% organic growth confirmed could trigger a good recovery. With such a good spread of revenue across the world, this has some defensive qualities

edit 10/7 looking at DGE website it says there wont be an interim statement like last year so we have to wait to August results

[williebiz] 19/6/2008 16:43

Yep but the mkt does throw up these opportunities from time to time, nothing to stop the share price dropping further though. 12x would give 720p, sobering thought.

[adr5] 19/6/2008 16:40

The share price is heading towards 2 years low of around 900p. One would have thought that this is one of the most defensive play in the current market conditions. No write downs, no subprime, cash generative, diversified source or revenue.

[betman] 05/6/2008 16:14

Good rise today so far +18 to 1003
Is this the recent upgrades, approval of Ketel One purchase today from Fed or investors getting ready for year end and a good set of results beating the analysts forecasts ?
Still good upside here for a well spread geographical business and good exposure to BRIC economies away from Credit crunch territories.
Also there is still upside from a beer business purchase to get Total Beverage Alcohol coverage

[gateside] 27/5/2008 07:58

Diageo upgraded with raised target
an ADVFN competitor
ING has upgraded its recommendation on Diageo to 'buy' from 'hold' and increased its price target to 1,180p from 1,150p on valuation grounds this morning, citing strength in its scotch whisky portfolio which accounts for a quarter of its sales.

In April, ING issued its analysis on the Scotch whisky market for the coming years, which it believes will experience a substantial value enhancement from rising demand from emerging markets and in particular from the enormous Indian whisky culture

ING said in a note it thinks Diageo, with 25% of its sales in Scotch, will be a prime beneficiary of these developments in the maturing-drink segment.

The broker also feels Diageo benefits from most of the driving factors in what it calls premiumisation, the rise in the number of middle-class earners, lifestyle changes, individuality, demographics and increased spending by women.

The broker thinks the fears about Diageo trading down and the strong rise in the cost of goods sold in full-year 2009 has weakened the sentiment in the stock and led to an attractive level.

[gateside] 09/5/2008 07:24

The Investment Column: Investors can raise a glass to dependable drinks firm Diageo

Friday, 9 May 2008

Our view: Buy

Share price: 1028p (-14p)

It is pretty difficult to get that excited about the statement posted yesterday by the drinks company Diageo, which owns the likes of Guinness, Smirnoff vodka and Johnnie Walker whisky, such was its brevity. However, more generally, investors worried about the credit crunch will be raising a glass to the group's hitherto steady-as-she-goes approach.

The company's chief executive, Paul Walsh, says that drinks are an "affordable indulgence" that have not yet suffered in the financial downturn, particularly in Diageo's biggest growth areas of Africa and Asia. A spokesman for the group, however, conceded that if things get worse, Diageo would of course feel a little of the pinch, especially in the United States.

The company does not want to be regarded as a defensive stock (a good reputation for now, but not racy enough in a bull market). However, Merrill Lynch reckons that is exactly why investors should pile in.

"We forecast [estimated] 2008 earnings growth of greater than 13 per cent for Diageo, above the 12 per cent growth estimated for the brewers," they say. "It would appear that the market is valuing Diageo's growth on a similar basis to its peers, whilst not factoring in any potential additional premium on Diageo for its more visible and defensive earnings per share growth."

Dresdner Kleinwort disagrees, pointing out that no matter how much drinks are seen as an affordable luxury, if the American consumer loses his job, he is not going to keep spending on pricey beverages. It points out that Diageo trades at a premium to SABMiller, which has better growth potential because of its greater emerging markets exposure.

The numbers posted yesterday show a 7 per cent sales growth for the third quarter, bang on most analysts' expectations. The group reiterated its target of 9 per cent organic operating profit for the fullyear.

Investors will benefit from Diageo's £1bn share buyback programme, which has no doubt helped the stability of the stock price: while groups in other sectors have seen shares nosedive in the past 12 months, Diageo's have dropped just 2 per cent.

SABMiller may represent a better option, and a prolonged financial crisis would kybosh the group's defensive qualities, but others will suffer long before Diageo does. Buy.

[betman] 08/5/2008 12:29

City didnt seem to like it, presumably they were looking for an upgrade to 10% organic profit growth !!!
This is a very well diversified group with good exposure to BRIC economies. Still throwing off cash and buying back shares.

[williebiz] 08/5/2008 07:42

Reading between the lines: trading was tough in western mkts, compensated by some growth in newer mkts; currency movements not really a worry since we report in £.

Not, however, remotely a profit warning. Good steady share.

[gateside] 08/5/2008 07:06

Interim management statement for the nine months ended 31 March 2008

Diageo maintains full year guidance for 9% organic operating profit growth in
year ending 30 June 2008.


In the nine month period ended 31 March 2008 Diageo's organic net sales growth
was 7%, in line with the performance seen in the first half of the year ending
30 June 2008.

There has been no material change in the financial position of the group. The
return of cash to shareholders through the payment of dividends and the
continued share buy back programme led to a reduction in net assets from #4.2
billion at 30 June 2007 to #3.9 billion at 31 March 2008.

Paul Walsh, Chief Executive of Diageo commented:

'Trading in the third quarter continued in line with the first half and we are
therefore maintaining our guidance for 9% organic operating profit growth for
the current fiscal year.

'We continue to believe that the diversity and strength of our brands, the
success of our marketing campaigns, our superior routes to market and our global
reach will be key in delivering our performance .'

[betman] 29/4/2008 10:19

In fairness to Lehman Bros their medium term target is 1200p and the 1700p was only if a mega beer deal was done

We retain O/W and a TP at 1200p as better
medium term momentum offsets short term
earnings dilution and higher capex.
�� We continue to believe that if Diageo is to become
more involved in TBA, significant value could be
created for shareholders (ref. our note "About time
for TBA", dated 2 November 07) - this could boost
fair valuations to over 1,700p

[williebiz] 10/4/2008 10:22

Can't see DGE going into beer, it's a mug's game. More likely step up investment in China/Asia and fill a few holes in the spirits portfolio

[georavello] 10/4/2008 10:02

If we could rely on broker forecasts this game would be simple.

[wad collector] 10/4/2008 08:41

£17 seems a bit optimistic this year!

[betman] 09/4/2008 14:31

many of the brokers are talking seriously about DGE getting more into Beer to further their TBA aim. Lehman Bros on the 10th March put a fair value at 1700p following a successful mega merger. Now that would squeeze a few shorts !!!!

[wad collector] 08/4/2008 20:42

Tipped by Peter Clegg of WHIreland last week.Gist of article was US premium spirits growth ,emerging Asian and Pacific growth ,solid African beer sales combines with political stability in S.America and Africa (Not sure about this bit!) which is undermining illicit liquors.

You are braver than me georavello.I am happy to hold.

[georavello] 08/4/2008 11:23

Looks like a shorting opportunity.

[broadwood] 01/4/2008 16:19

Big strong rec from across the Atlantic - via CNBC.

[gateside] 07/3/2008 07:36

Diageo, Heineken and Namibia Breweries announce new joint ventures in South
Africa


Diageo plc ('Diageo'), Heineken International BV ('Heineken') and Namibia
Breweries Limited ('NBL') have today announced that they have reached agreement
to form a new joint venture for their combined beer, cider and RTD businesses in
South Africa, to be called DHN Drinks (Pty) Limited ('DHN Drinks'). The new
joint venture builds on the success of brandhouse Beverages (Pty) Limited ('
brandhouse'), the parties' current cost-sharing joint venture in South Africa
which was formed in July 2004.

Diageo and Heineken will each own 42.25% of DHN Drinks and NBL will own 15.5%.
Each party will share in the profits of DHN Drinks in proportion to their
shareholding. brandhouse will continue to market and distribute the parties'
products in South Africa.

In addition, Diageo and Heineken will enter into a second new joint venture in
South Africa ('Supplyco'). Supplyco will construct a brewery and bottling plant
in Gauteng province, South Africa, and will produce Amstel and certain other key
brands. Heineken will own 75% and Diageo will own 25% of Supplyco.

In the first two years Diageo will invest £100 million in DHN Drinks and
Supplyco. The investment meets Diageo's return criteria.

The transaction, which is subject to regulatory approval, is expected to
complete on 31 March 2008.



Nick Blazquez, Managing Director of Diageo Africa said:

'The decision by Diageo, Heineken and Namibia Breweries to commit to a closer
relationship in South Africa reflects the success of brandhouse and acknowledges
the changing nature of the beverage alcohol market in South Africa. We have
already demonstrated that a combined beverage alcohol distribution company can
capitalise on the growth opportunities in markets such as South Africa and the
new structure will enable us to realise further growth opportunities as a result
of the strong platform we will create together.'

[wad collector] 14/2/2008 18:51

Impressive results , the upward trend looks set to continue.Good to see a blue share.

[gateside] 28/1/2008 07:46

Diageo to acquire highly rated Rosenblum Cellars


Diageo, the world's leading premium drinks business, announced today that it has
entered into an agreement to acquire Rosenblum Cellars. The acquisition
represents a unique opportunity to own a highly rated Zinfandel brand and
therefore it further enhances Diageo Chateau and Estate Wines' brand range in
the fastest growing segment of US wines, the premium segment. The consideration
$105 million and it is anticipated that the acquisition will be economic profit
positive during the fourth full year of ownership.


Rosenblum Cellars, which is based in Alameda California was founded in 1978 by
Kent and Kathy Rosenblum and is one of the leading producers of Zinfandel and
Rhone varietals in the United States. As part of the acquisition, Kent Rosenblum
will continue to make award-winning wines and he will play a key advisory role
in the strategic direction of the brand.


The transaction, which is subject to regulatory approval in the United States,
is expected to complete in the first quarter of calendar year 2008.


Commenting, Ivan Menezes, President, Diageo North America said:


'The acquisition of Rosenblum Cellars represents an important strategic fit for
us, as it enhances Diageo's presence in the premium Zinfandel segment, one of
the fastest growing varietals in the US. We look forward to working with the
Rosenblums in growing this brand as we continue to focus on the quality for
which these wines are known and in addition allow the wines to benefit from
Diageo's superior distribution network in the US.'

[the other kevin] 11/1/2008 09:42

Coming back a bit - looks like you got it right!

[got it wrong] 11/1/2008 08:47

Looks like a bear raid...bought some @ 998.75

[the other kevin] 11/1/2008 08:41

What's up?

[call-logger] 07/1/2008 08:22

Well, not quite first thing, in at 1065

[call-logger] 06/1/2008 03:33

Right, I'm buying first thing Monday, then