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Is Diageo plc(NYSE: DEO), a large market cap stock a smart buy?

With a market cap of has a large market cap size. Diageo plc (NYSE: DEO) has been on the stock market since its IPO date on the 5/13/1996. Diageo plc is in the Beverages – Wineries & Distillers industry and Consumer Goods sector. Average volume for Diageo plc, is 746.14, and so far today it has a volume of 1405100. Performance year to date since the 5/13/1996 is 5.32%.

To help you determine whether Diageo plc is undervalued the following values will help you decide. P/E is 22.36 and forward P/E is 20.35. PEG perhaps more useful shows that Diageo plc has a value for PEG of 4.76. P/S ratio is 5.24 and the P/B ratio is 6.77. The P/Cash and P/Free cash flow is 72.29 and 85.66 respectively.

At the current price Diageo plc is trading at, 113.44 (0.57% today), Diageo plc has a dividend yield of 2.24%, and this is covered by a payout ratio of 58.20%. Earnings per share (EPS) is 5.07, and this is looking to grow in the next year to -16.13% after growing 2.10% this past year. EPS growth quarter over quarter is -17.20%, and -5.50% for sales growth quarter over quarter.

The number of shares outstanding is 626.75, and the number of shares float is 625.78. The senior management bring insider ownership to 0.70%, and institutional ownership is at 11.80%. The float short is 0.11%, with the short ratio at a value of 0.92. Management has seen a return on assets of 9.60%, and also a return on investment of 15.40%.

The ability for Diageo plc, to deal with debt, means it current ratio is 1.5, and quick ratio is 0.8. Long term debt/equity is 1.03 and total debt/equity is 1.28. In terms of margins, Diageo plc has a gross margin of 57.60%, with its operating margin at 30.70%, and Diageo plc has a profit margin of 23.50%.

The 52 week high is -4.15%, with 14.73% being its 52 week low. The 20 day simple moving average is 4.71% and the 200 day simple moving average is 4.79%.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.


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Mark Hines

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