Diageo: Jefferies downgrades stock
(CercleFinance.com) - Jefferies downgraded Diageo shares from "buy" to "hold" on Friday, reducing its target price for them from 4,000p to 3,800p.
In a report, the analyst praised the wine and spirits group's attractive long-term fundamentals, although said that the market would have to take into account the prospect of slower growth in the US in the near term.
While the consensus is looking for 4.5% organic growth in the US market for 2023/2024, the broker says that it is expecting much lower sales growth of around 1%.
Jefferies says that this slowdown reflects the logical "normalisation" of the sector following the exceptional performance recorded over the pandemic, but also a risk of inventory adjustment and a downturn in the economy.
Copyright (c) 2023 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
In a report, the analyst praised the wine and spirits group's attractive long-term fundamentals, although said that the market would have to take into account the prospect of slower growth in the US in the near term.
While the consensus is looking for 4.5% organic growth in the US market for 2023/2024, the broker says that it is expecting much lower sales growth of around 1%.
Jefferies says that this slowdown reflects the logical "normalisation" of the sector following the exceptional performance recorded over the pandemic, but also a risk of inventory adjustment and a downturn in the economy.
Copyright (c) 2023 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.