Diageo, the maker of Johnnie Walker Scotch whisky, Captain Morgan rum and Guinness, will soon begin a new growth cycle “under the leadership of a heavyweight new chief financial officer”, Jefferies said. The investment bank upgraded its rating on the stock to buy from hold on Thursday, raising its price target on Diageo’s U.S.-traded shares to $141 from $129, implying a 19% upside potential. Analyst Edward Mundy believes Diageo will hit bottom in 2025 before starting to recover in 2026. Boost Diageo’s profits and cash. “Diageo operates in an attractive medium-term industry with an enviable brand portfolio, strong distribution network and proven marketing capabilities,” Mondi wrote in an 87-page report. “Our upgrade is not an attempt to accurately calculate the (business) cycle; however, the data has not gotten worse and destocking is largely complete. The market argument is that the lack of growth is structural; our view is that it is cyclical Yes, F25 represents the trough,” the analyst added. As of Wednesday’s close, the distillery’s 2024 production had fallen 19%, but output remained around 4.3%, according to FactSet. Shares of the stock were up 4.8% in early trading Thursday. DEO Diageo stock analysts have been downbeat on the stock so far this year. Six analysts rate it a hold or underperform, while two have a strong buy rating, according to London Stock Exchange data.
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