Diageo: Built For Premiumization, With A New CEO And A Clear Path To Recovery
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IWA Research1.87K FollowersFollow5ShareSavePlay(15min)CommentsSummaryDiageo is rated Buy, trading at decade lows but poised for recovery via market improvements, cost savings, and a new CEO with turnaround expertise.Despite US and China weakness, DEO expects $3B free cash flow in FY26, aided by CAPEX cuts and a resilient premium brand portfolio.Accelerated cost savings target raised to $625M; dividend yield stands at 4.65%, though future policy under new leadership remains uncertain.Premiumization, India market access, and potential M&A interest offset risks from debt, tariffs, and regulatory headwinds, supporting the Buy thesis. Derick Hudson/iStock Editorial via Getty Images Introduction Diageo (DEO) (DGEAF) is currently trading at its lowest levels since early 2012, with a potential opportunity stemming from their potential to recover thanks to market improvements, accelerated cost savings, and a new CEO named recently. Diageo is theThis article was written byIWA Research1.87K FollowersFollowAs of 2025, I've got over 10 years of researching companies. In total, throughout my investing life, I estimate that I researched (in depth) well over 1000 companies, from commodities like oil, natural gas, gold and copper to tech like Google or Nokia and many emerging market stocks, which I believe could help me provide useful content for readers. After writing my own blog for about 3 years, I decided to switch to a value investing-focused YouTube channel, where I researched hundreds of different companies so far. I would say my favorite type of company to cover are metals and mining stocks, but I am comfortable with several other industries, such as consumer discretionary/staples, REITs and utilities.Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in DEO over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.