Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, alcoholic beverage giant Diageo (NYSE: DEO ) has earned a coveted five-star ranking.
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 |
$47.5 billion |
| Industry |
Distillers and vintners |
| Trailing-12-Month Revenue |
$15.6 billion |
| Management |
CEO Paul Walsh (since September 2000)
CFO Deirdre Mahlan (since October 2010)
|
| Return on Capital (Average, Past 3 Years) |
13.5% |
| Cash/Debt |
$2.3 billion / $14.1 billion |
| Dividend Yield |
3.3% |
| Competitors |
Fortune Brands (NYSE: FO )
Constellation Brands (NYSE: STZ )
Brown-Forman (NYSE: BF-B )
|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 98% of the 2,357 members who have rated Diageo believe the stock will outperform the S&P 500 going forward. These bulls include jjfoolguy and All-Star telcomac99, who is ranked in the top 5% of our community.
A few months ago, jjfoolguy advised Fools to drink in Diageo: "Great brands & marketing. Global demographics and emerging markets will pay nice returns for this stock."
Diageo's portfolio of well-known brands (it owns eight of the world's top 20), scale, and exciting emerging-markets exposure continue to drive its perfect five-star CAPS status. While it's boosted by a big use of leverage, Diageo's three-year average return on equity (44.7%) easily bests that of rivals Fortune Brands (6.1%), Constellation (-9.4%), and Brown-Forman (25.3%), as well as other alcoholic beverage plays like Boston Beer (NYSE: SAM ) (17.9%) and Molson Coors (NYSE: TAP ) (8.6%).
With as many positives as CAPS All-Star telcomac99 lists, Diageo is certainly worth looking into:
- High quality products
- Excellent brand names / brand recognition
- Good dividends
- A stable market, as alcohol is relatively recession proof
- Long term growth prospects
...
This company has longevity. Buy and hold long term, reap steady returns through dividends, and watch the overall value of the stock increase as the company grows in new regions around the globe.
What do you think about Diageo, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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