Based on the aggregated intelligence of 145,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, alcoholic-drink distributing giant Diageo
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 |
$49.1 billion |
|
Industry |
Wineries and distillers |
|
Trailing-12-Month Revenue |
$15.5 billion |
|
Management |
CEO Paul Walsh (since 2000) |
|
Major Brands |
Smirnoff, Johnnie Walker, Captain Morgan, Guinness, Baileys |
|
Return on Equity (Average, Past 3 Years) |
40% |
|
Cash/Debt |
$1.5 billion / $14.3 billion |
|
Dividend Yield |
3.2% |
|
Competitors |
Brown-Forman |
|
CAPS Members Bullish on DEO Also Bullish on |
Altria |
|
CAPS Members Bearish on DEO Also Bearish on |
Novartis |
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 98% of the 2,254 members who have rated Diageo believe the stock will outperform the S&P 500 going forward. These bulls include All-Star TMFmrquakeroats, who is ranked in the top 15% of our community, and 3dollarhedgefund.
Just a couple of months ago, TMFmrquakeroats made a short toast to the special stock: "High quality beverage company. Great dividend. Predictable business. [Diageo] should outperform the S&P over many years."
In a pitch from earlier this month, 3dollarhedgefund expands on the intoxicating opportunity:
Their brands include Guinness, Johnny Walker, Captain Morgan, Gordon's, Tanqueray, Smirnoff. ... [W]ith a fairly consistent revenue stream and a 3.5% dividend yield, it would be an appealing business in any case. The relatively high level of debt is adequately serviced by earnings, while gross margins are in the neighborhood of 60%. But what makes the company so attractive to us at this price is the ability to use US dollars at their current purchasing power to buy future earnings in a variety of world currencies, which increasingly will derive from consumers in emerging markets.
What do you think about Diageo, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. The CAPS community is waiting to hear your opinions. CAPS is 100% free, so get started!
