London, Feb 27, 2026, 08:58 GMT — Regular session
- Diageo shares hovered near flat in early London trading, following a two-day slide.
- Citi lowered its target price, though the firm stuck with a “buy” rating, pointing to more challenging U.S. conditions.
- Investors want specifics on CEO Dave Lewis’s turnaround strategy and the timing for April’s dividend payout.
Diageo slipped 0.1% to 1,584.5 pence as of 0858 GMT. Citi trimmed its price target to 2,200p from 2,425p on Thursday but maintained a “buy” call. London South East
After plunging Wednesday, the stock has struggled to stabilize. Spirits maker Diageo slashed its interim dividend by half and trimmed its full-year sales forecast—that news landed during new CEO Dave Lewis’s debut results presentation.
This is significant: Diageo’s status in London has been that of a defensive, income-rich stock. Now, with both its guidance and dividend coming under pressure, forced selling could follow. Investors are left waiting to see whether management’s fresh strategy delivers.
“There is no point trying to dress up the six-month figures. These are awful results, and the repair job is massive,” said Dan Coatsworth, head of markets at AJ Bell, following Diageo’s update. Shares in Pernod Ricard, Remy Cointreau, and Campari dropped the same day, with investors cutting back expectations for the spirits sector. Reuters
Diageo plans to pay an interim dividend of 20 cents per share, setting April 16 as the ex-dividend date for ordinary shareholders and aiming for a payout on June 4. “The Board has taken the difficult decision to reduce the dividend to a more appropriate level which will accelerate the strengthening of our balance sheet,” Lewis stated in the results release. Investegate
The company noted a slowdown in North American trading and ongoing headwinds for Chinese white spirits. Management highlighted moves to unlock cash and trim leverage through asset disposals and cost-cutting.
Citi trimmed its FY26 earnings per share outlook, pointing to a “challenging” U.S. environment that’s forced it to cut estimates again. The bank flagged that near-term outflows from income funds “may be unhelpful,” though it also said expectations have already been reset. Halifax
Investors are eyeing whether targeted price cuts or stepped-up spending to hold onto market share will end up pressuring margins beyond what management has projected. U.S. consumers remain in a trading-down mode.
There’s a risk here: if the U.S. slowdown drags on beyond forecasts, or if aggressive discounting catches on, Diageo could be pushed into a harsher volume-versus-price squeeze just as it works to cut debt.
Investors are watching for more specifics on Lewis’s strategy moves this quarter, as well as the ex-dividend date coming up April 16—a first look at how the shareholder mix might shift following the reset in payouts.
