Diageo (DGEAF) versus Its Rivals Critical Analysis

Profitability

This table compares Diageo and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diageo	N/A	N/A	N/A
Diageo Competitors	-8.02%	-9.45%	0.18%

Valuation & Earnings

This table compares Diageo and its competitors gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Diageo	N/A	N/A	28.66
Diageo Competitors	$50.66 billion	$883.52 million	10.75

Diageo’s competitors have higher revenue and earnings than Diageo. Diageo is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Dividends

Diageo pays an annual dividend of $0.52 per share and has a dividend yield of 2.3%. Diageo pays out 66.3% of its earnings in the form of a dividend. As a group, “Beverages” companies pay a dividend yield of 3.0% and pay out 49.0% of their earnings in the form of a dividend. Diageo lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Insider & Institutional Ownership

33.3% of Diageo shares are owned by institutional investors. Comparatively, 36.6% of shares of all “Beverages” companies are owned by institutional investors. 19.1% of shares of all “Beverages” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Diageo competitors beat Diageo on 6 of the 9 factors compared.

About Diageo

Diageo plc, together with its subsidiaries, engages in the production, marketing, and sale of alcoholic beverages. It offers scotch, gin, vodka, rum, raki, liqueur, wine, tequila, Chinese white spirits, cachaça, and brandy, as well as beer, including cider and flavoured malt beverages. The company also provides Canadian, Irish, American, and Indian-Made Foreign Liquor whiskies, as well as ready to drink and non-alcoholic products. It provides its products primarily under the Johnnie Walker, Guinness, Tanqueray, Baileys, Smirnoff, Captain Morgan, Crown Royal, Don Julio, Cîroc, Buchanan's, Casamigos, J&B, and Ketel One brands. The company operates in the United States, the United Kingdom, Turkey, Australia, Korea, India, Greater China, Brazil, Mexico, South Africa, Nigeria, and internationally. Diageo plc was incorporated in 1886 and is headquartered in London, the United Kingdom.