London, June 8, 2026, 15:11 BST
- Diageo traded 0.6% higher at 1,504.0 pence in a Cboe Europe real-time quote.
- Jefferies’ Edward Mundy stuck with his Buy call and took his price target up to 2,000 pence.
- Next up is Diageo’s strategy update on Aug. 6. North America remains the main question mark.
Diageo shares gained in Monday London trade, up 0.6% to 1,504.0 pence by a Cboe Europe quote, after Jefferies lifted its price target. Investors took the move as a fresh cue to push into the drinks group’s recovery story following its extended slide. The London Stock Exchange was trading as usual from 8:00 a.m. to 4:30 p.m. BST.
Diageo’s recent move is in focus as the market weighs if May’s sales beat points to a recovery or was just a blip. Jefferies analyst Edward Mundy kept his Buy call and bumped his target price up to 2,000 pence from 1,900 pence, according to MarketScreener.
Diageo shares climbed 1.49% Friday to 1,495 pence, beating a slight uptick in the FTSE 100, but the stock is still off 6.5% for the year and trading well below its 52-week high at 2,142 pence, according to MarketScreener. The company makes Johnnie Walker, Guinness and Smirnoff.
FTSE 100 edges up as London shakes off early declines
The FTSE 100 picked up 0.2% by midday Monday to 10,386.53. London stocks clawed back after dropping earlier on renewed Iran-Israel conflict and higher rate concerns. Diageo posted a small gain while other consumer names didn’t see clear buying.
North America dragged on results. Diageo posted fiscal third-quarter net sales of $4.48 billion, up 2.3% reported, while organic net sales edged up 0.3%. Analysts were looking for a 2.3% drop in organic sales. Europe, Latin America and Africa offset the weakness, but North American sales slid 9.4%.
Chief Executive Sir Dave Lewis called it straight. “North America remains our biggest challenge,” Lewis said in Diageo’s trading statement. He said the company is already taking action and told shareholders to expect a strategy update when full-year results come on Aug. 6. SEC
Investors are waiting to see more from Lewis. “It’s early days for Dave, but he does seem to be grasping it,” said Richard Scrope, manager of VT Tyndall Global Select, a Diageo shareholder, to Reuters after the May update. Reuters
Jefferies took a careful line after Q3. In May, its analysts said they saw shares as “gently better” with a small beat and no new negatives, but they didn’t expect consensus for fiscal 2026 to shift. Investing
Mixed signals from peers. Brown-Forman, which owns Jack Daniel’s, beat quarterly sales estimates last week but warned that consumer spending is still tight. The company also sees flat organic sales for fiscal 2027. That continues to weigh on the wider spirits market, as Diageo and Pernod Ricard deal with the same soft U.S. demand.
The risk is analyst backing now rests mostly on the August plan. If U.S. spirits demand stays weak, tequila price cuts don’t drive sales, or Middle East tension keeps energy, glass and shipping costs elevated, Diageo’s margin comeback could stall and shares could give back the recent gains since the May update.
Simpler story for the market compared to February: guidance stands, Jefferies says there’s room for more gains, and shares have leveled off. The challenge isn’t over. Lewis still needs to prove the U.S. unit can return to growth without sacrificing price or cash flow.
