Based on the aggregated intelligence of 120,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, Diageo (NYSE: DEO ) , the world's largest alcoholic drink distributor, has earned a coveted five-star ranking. Our data has shown that five-star stocks outperform the market by a significant margin; conversely, one-star stocks have woefully lagged the market average.
With that in mind, let's take a closer look at Diageo's business and see what CAPS investors are saying about the stock right now.
Diageo facts
|
Headquarters (Founded)
|
London (1886)
|
|
Market Cap
|
$38.71 Billion
|
|
Industry
|
Distillers and Vintners
|
|
Trailing-12-Month Revenue
|
$13.85 billion
|
|
Management
|
CEO Paul Walsh (Since 2000)
CFO Nicholas Rose (Since 1999)
|
|
Brands
|
Smirnoff, Johnnie Walker, Captain Morgan, Guinness, Baileys
|
|
Return on Capital (Average, Past Three Years)
|
13.6%
|
|
Dividend Yield
|
4.9%
|
|
Competitors
|
Constellation Brands (NYSE: STZ ) , Fortune Brands (NYSE: FO )
|
|
CAPS Members Bullish on DEO Also Bullish on:
|
Altria Group (NYSE: MO )
Johnson & Johnson (NYSE: JNJ )
|
|
CAPS Members Bearish on DEO Also Bearish on:
|
Chesapeake Energy (NYSE: CHK )
UnitedHealth Group (NYSE: UNH )
|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
Over on CAPS, 484 of the 489 All-Star members who have rated Diageo -- some 99% -- believe the stock will outperform the S&P 500 going forward. These Foolish bulls include rd80 and SoapyHollow, both of whom are ranked in the top 2% of our community.
In June, rd80 said of Diageo's business model:
... shouldn't be very sensitive to economic conditions and U.S. investors should benefit since much of their operations are in other currencies. Steady business (booze), decent dividend and reasonable multiple. What's not to like?
A more recent pitch from SoapyHollow this month shares that bullishness and elaborates on the stock's recession-proof qualities:
"Sin" stocks and defensive stocks are traditionally the best performers in economic downturns. People give up a lot of things, but booze isn't usually one of them.
As the largest producer and distributor of well known brands in the alcohol market, [Diageo] is well poised to stand strong in this market. They have a $44 Billion market cap, a profit margin hovering around 20%.
What do you think about Diageo, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 120,000 investors are waiting to hear what you have to say. CAPS is 100% free, so get started!
RSS Headlines
Fool UK