Diageo (DEO, $160.55) H1 earnings beat analysts’ expectations
Beverage company Diageo’s earnings for the first half of the year beat analysts’ expectations.
The company’s adjusted earnings plunged almost -13% year-over-year to 69 (73 cents) per share, but surpassed the 67.8 pence analysts had expected. Higher operating costs and a stronger pound affected earnings.
The result was bolstered by strong demand in North America, with 80% of its sales coming from retail stores.
There was a +1% increase in organic net sales growth for the six months to Dec. 30, compared to a drop of -4.6% that analysts had expected.
While the company did not issue any specific annual sales guidance, it mentioned that it expected organic operating profit growth in the second half would be ahead of organic net sales growth in all regions, except in North America.
The company’s adjusted earnings plunged almost -13% year-over-year to 69 (73 cents) per share, but surpassed the 67.8 pence analysts had expected. Higher operating costs and a stronger pound affected earnings.
The result was bolstered by strong demand in North America, with 80% of its sales coming from retail stores.
There was a +1% increase in organic net sales growth for the six months to Dec. 30, compared to a drop of -4.6% that analysts had expected.
While the company did not issue any specific annual sales guidance, it mentioned that it expected organic operating profit growth in the second half would be ahead of organic net sales growth in all regions, except in North America.
DEO's Indicator enters downward trend
The Aroon Indicator for DEO entered a downward trend on December 03, 2024. Tickeron's A.I.dvisor identified a pattern where the AroonDown red line was above 70 while the AroonUp green line was below 30 for three straight days. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options. A.I.dvisor looked at 218 similar instances where the Aroon Indicator formed such a pattern. In of the 218 cases the stock moved lower. This puts the odds of a downward move at .
Technical Analysis (Indicators)
Bearish Trend Analysis
The 10-day moving average for DEO crossed bearishly below the 50-day moving average on October 31, 2024. This indicates that the trend has shifted lower and could be considered a sell signal. In of 15 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where DEO declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
DEO broke above its upper Bollinger Band on December 05, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where DEO's RSI Oscillator exited the oversold zone, of 26 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. of 62 cases where DEO's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Momentum Indicator moved above the 0 level on December 05, 2024. You may want to consider a long position or call options on DEO as a result. In of 90 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for DEO just turned positive on November 22, 2024. Looking at past instances where DEO's MACD turned positive, the stock continued to rise in of 41 cases over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where DEO advanced for three days, in of 315 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (8.410) is normal, around the industry mean (3.922). P/E Ratio (19.766) is within average values for comparable stocks, (28.956). Projected Growth (PEG Ratio) (1.797) is also within normal values, averaging (2.099). Dividend Yield (0.027) settles around the average of (0.024) among similar stocks. P/S Ratio (3.888) is also within normal values, averaging (6.048).
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. DEO’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. DEO’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 94, placing this stock worse than average.
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General Information
a producer of wine, beer and other beverages
Industry BeveragesAlcoholic