Diageo PLC ADR
NYSE: DEO · CONSUMER DEFENSIVE · BEVERAGES - WINERIES & DISTILLERIES
Updated 2026-06-05
Diageo PLC ADR (DEO) Stock Valuation Analysis
Fair value estimate, historical valuation range, and quality signals for DEO.
Valued
Valuation reasonably reflects current fundamentals. Limited margin of safety at these levels.
DEO historical valuation range
Where current P/E sits in DEO's own 5Y range.
DEO intrinsic value (DCF)
DCF-based fair value estimate vs current market price.
Intrinsic value calculated using discounted cash flow (DCF) model based on projected free cash flows, discount rate, and terminal growth assumptions. A positive margin of safety indicates the current price is below estimated fair value, providing a cushion against estimation error.
DEO valuation signals
Quick-read green flags, caution flags, and risks based on current metrics.
P/E Ratio — History
Current: 18.57x
P/S Ratio — History
Current: 2.26x
Is DEO overvalued in 2026?
Diageo PLC ADR (DEO) currently trades at $82.02 per share with a market capitalization of $44,699,918,000.00. Based on our multi-factor framework, the stock trades at a fair valuation with a Smart Value Score of 56/100. This score blends growth quality, financial health, and price attractiveness into a single institutional-grade read.
The stock trades at a P/E ratio of 18.6x, below its 5-year median of 20.1x. The PEG ratio of 0.79 suggests earnings growth is outpacing the multiple, a classic sign of undervaluation.
Looking at its own history, DEO is currently trading cheaper than 76% of the last 5Y on P/E. This places it in the 24th percentile of its historical range, a level that has historically coincided with attractive entry points.
Our discounted cash flow model estimates DEO's intrinsic value at $220.42 per share, against the current market price of $82.02. This implies a margin of safety of +54.26%. A meaningful cushion exists against model error, making this a reasonable risk-adjusted entry.
Financial quality is a concern. The Piotroski F-Score of 3/9 flags weakening fundamentals that deserve closer scrutiny before the valuation case can be fully trusted.
Bottom line: DEO trades at a fair valuation on our framework, with a Smart Value Score of 56/100. The valuation is defensible but offers no obvious bargain. Patience or a better entry price may reward disciplined buyers.
Frequently asked questions
Is DEO overvalued?
DEO scores 56/100 on our Smart Value Score (Grade C+), a mixed overall profile. The DCF also shows a positive margin of safety, so price and fundamentals line up reasonably well.
What is DEO's fair value?
Our DCF model estimates DEO's intrinsic value at $220.42 per share, versus the current price of $82.02, a margin of safety of +54.26%. Fair value is the present value of the cash flows we project the business to produce, so a price below it means the market is pricing the stock below that conservative estimate.
What P/E ratio does DEO trade at?
DEO trades at a P/E of 18.6x on trailing twelve-month earnings, against a 5-year median of 20.1x. P/E is what you pay per dollar of profit, and sitting below its own median means the stock is cheaper than usual relative to its earnings.
Is DEO a buy based on valuation?
Our Smart Value rating for DEO is Hold, from a Smart Value Score of 56/100 that blends growth, quality, and valuation. The profile is balanced and best suited to investors who already have a thesis. This is research to inform your decision, not personalized financial advice.
How does DEO's valuation compare to its history?
On P/E, DEO sits in the 24th percentile of its own 5Y range, historically cheap relative to where it has traded. A low percentile means today's multiple is near the bottom of its historical band.
What is DEO's Smart Value Score?
DEO's Smart Value Score is 56/100. It is a proprietary WallStSmart metric blending growth quality, financial health, and valuation into a single 0-100 read, and scores above 75 are rare, signaling strong multi-factor alignment.