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Here's What's in Store for Diageo (DEO) in 1H24 Earnings
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Diageo Plc (DEO - Free Report) is scheduled to release interim results for the first half of fiscal 2024 on Jan 30. The company has been witnessing solid business momentum, strong consumer demand and market share gains, which have been boosting its performance. DEO is anticipated to have retained the strength in its business on constant premiumization efforts and favorable industry trends, particularly in the spirits category.
Notably, the alcoholic beverage company, which reports on a half-yearly basis, posted strong top-line growth, organic operating margin expansion and productivity savings in fiscal 2023. Effective marketing and exceptional commercial execution further aided the results.
However, the Zacks Rank #2 (Buy) company has been suffering from persistent inflationary pressures, induced by higher commodity costs, particularly agave, energy expenses and supply disruptions.
We expect the company’s first-half fiscal 2024 total revenues to increase 1.8% year over year in local currency and the bottom line in U.S. dollars to increase 6.3% to $4.93 per share.
DEO has been benefiting from its diversified footprint, advantaged portfolio, strong brands and favorable industry trends of premiumization. The company is anticipated to have retained the strength in its business in the fiscal first half through constant premiumization efforts, recovery across markets, pricing actions and supply productivity savings.
Diageo has been well-poised for growth from effective marketing and exceptional commercial execution. It has been investing strongly in marketing and innovation, and leveraging its revenue growth management capabilities, including strategic pricing actions. This is likely to have supported DEO’s top and bottom-line growth in the to-be-reported period.
Moreover, DEO’s margin trends have been favorable, owing to its premiumization efforts, ongoing recovery in markets, pricing actions and disciplined cost management, which have been offsetting cost inflation. Productivity savings, driven by COGS productivity and marketing effectiveness, are expected to have aided the margin in the first half of fiscal 2024.
The company anticipated operating margin gains through fiscal 2024, driven by a moderating inflationary environment and continued focus on revenue management initiatives, including improved pricing. Moreover, the organic operating margin is likely to benefit from premiumization trends and operating leverage with strong marketing investments.
Our model predicts a 5% rise in operating profit in the first half of fiscal 2024. The operating margin is estimated to expand 50 basis points (bps) in the first half of fiscal 2024.
However, Diageo has been suffering from persistent inflationary pressures, induced by higher commodity costs, particularly agave, energy expenses and supply disruptions. As a substantial portion of Diageo’s business comes from international operations, exchange rate fluctuations have been hampering its sales for a while.
Diageo expects to continue its revenue-management initiatives, including pricing actions, throughout fiscal 2024 to overcome the challenging inflationary environment.
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Here are some companies you may want to consider this earnings season.
Coca-Cola (KO - Free Report) is likely to register top and bottom-line growth when it reports the fourth-quarter 2023 numbers. The Zacks Consensus Estimate for its quarterly revenues is pegged at $10.6 billion, which suggests growth of 4.8% from that reported in the prior-year quarter. KO currently has a Zacks Rank #2.
The Zacks Consensus Estimate for Coca-Cola’s quarterly earnings has been unchanged in the past 30 days to 48 cents per share. The consensus estimate suggests 6.7% earnings growth from the year-ago quarter’s reported number. KO has delivered an earnings beat of 5.1%, on average, in the trailing four quarters. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Mondelez International (MDLZ - Free Report) is expected to register top and bottom-line growth when it reports the fourth-quarter 2023 numbers. The Zacks Consensus Estimate for its quarterly revenues is pegged at $9.23 billion, which suggests growth of 6.2% from that reported in the prior-year quarter. The company currently has a Zacks Rank of 3 (Hold).
The Zacks Consensus Estimate for Mondelez’s quarterly earnings has moved up by a penny in the past 30 days to 77 cents per share. The consensus estimate suggests 5.5% earnings growth from the year-ago quarter’s reported number. MDLZ has delivered an earnings beat of 7.3%, on average, in the trailing four quarters.
Philip Morris International (PM - Free Report) currently has a Zacks Rank #3. PM is anticipated to register top and bottom-line growth when it reports the fourth-quarter 2023 results. The Zacks Consensus Estimate for Philip Morris’ quarterly revenues is pegged at $8.9 billion, indicating an improvement of 9.5% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for Philip Morris’ bottom line has moved down 2.7% in the past 30 days to $1.44 per share. The consensus estimate for PM suggests growth of 5.8% from the year-ago quarter’s reported figure.
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Here's What's in Store for Diageo (DEO) in 1H24 Earnings
Diageo Plc (DEO - Free Report) is scheduled to release interim results for the first half of fiscal 2024 on Jan 30. The company has been witnessing solid business momentum, strong consumer demand and market share gains, which have been boosting its performance. DEO is anticipated to have retained the strength in its business on constant premiumization efforts and favorable industry trends, particularly in the spirits category.
Notably, the alcoholic beverage company, which reports on a half-yearly basis, posted strong top-line growth, organic operating margin expansion and productivity savings in fiscal 2023. Effective marketing and exceptional commercial execution further aided the results.
However, the Zacks Rank #2 (Buy) company has been suffering from persistent inflationary pressures, induced by higher commodity costs, particularly agave, energy expenses and supply disruptions.
We expect the company’s first-half fiscal 2024 total revenues to increase 1.8% year over year in local currency and the bottom line in U.S. dollars to increase 6.3% to $4.93 per share.
Diageo plc Price, Consensus and EPS Surprise
Diageo plc price-consensus-eps-surprise-chart | Diageo plc Quote
Key Factors to Note
DEO has been benefiting from its diversified footprint, advantaged portfolio, strong brands and favorable industry trends of premiumization. The company is anticipated to have retained the strength in its business in the fiscal first half through constant premiumization efforts, recovery across markets, pricing actions and supply productivity savings.
Diageo has been well-poised for growth from effective marketing and exceptional commercial execution. It has been investing strongly in marketing and innovation, and leveraging its revenue growth management capabilities, including strategic pricing actions. This is likely to have supported DEO’s top and bottom-line growth in the to-be-reported period.
Moreover, DEO’s margin trends have been favorable, owing to its premiumization efforts, ongoing recovery in markets, pricing actions and disciplined cost management, which have been offsetting cost inflation. Productivity savings, driven by COGS productivity and marketing effectiveness, are expected to have aided the margin in the first half of fiscal 2024.
The company anticipated operating margin gains through fiscal 2024, driven by a moderating inflationary environment and continued focus on revenue management initiatives, including improved pricing. Moreover, the organic operating margin is likely to benefit from premiumization trends and operating leverage with strong marketing investments.
Our model predicts a 5% rise in operating profit in the first half of fiscal 2024. The operating margin is estimated to expand 50 basis points (bps) in the first half of fiscal 2024.
However, Diageo has been suffering from persistent inflationary pressures, induced by higher commodity costs, particularly agave, energy expenses and supply disruptions. As a substantial portion of Diageo’s business comes from international operations, exchange rate fluctuations have been hampering its sales for a while.
Diageo expects to continue its revenue-management initiatives, including pricing actions, throughout fiscal 2024 to overcome the challenging inflationary environment.
Looking for Lucrative Picks? Check These
Here are some companies you may want to consider this earnings season.
Coca-Cola (KO - Free Report) is likely to register top and bottom-line growth when it reports the fourth-quarter 2023 numbers. The Zacks Consensus Estimate for its quarterly revenues is pegged at $10.6 billion, which suggests growth of 4.8% from that reported in the prior-year quarter. KO currently has a Zacks Rank #2.
The Zacks Consensus Estimate for Coca-Cola’s quarterly earnings has been unchanged in the past 30 days to 48 cents per share. The consensus estimate suggests 6.7% earnings growth from the year-ago quarter’s reported number. KO has delivered an earnings beat of 5.1%, on average, in the trailing four quarters. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Mondelez International (MDLZ - Free Report) is expected to register top and bottom-line growth when it reports the fourth-quarter 2023 numbers. The Zacks Consensus Estimate for its quarterly revenues is pegged at $9.23 billion, which suggests growth of 6.2% from that reported in the prior-year quarter. The company currently has a Zacks Rank of 3 (Hold).
The Zacks Consensus Estimate for Mondelez’s quarterly earnings has moved up by a penny in the past 30 days to 77 cents per share. The consensus estimate suggests 5.5% earnings growth from the year-ago quarter’s reported number. MDLZ has delivered an earnings beat of 7.3%, on average, in the trailing four quarters.
Philip Morris International (PM - Free Report) currently has a Zacks Rank #3. PM is anticipated to register top and bottom-line growth when it reports the fourth-quarter 2023 results. The Zacks Consensus Estimate for Philip Morris’ quarterly revenues is pegged at $8.9 billion, indicating an improvement of 9.5% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for Philip Morris’ bottom line has moved down 2.7% in the past 30 days to $1.44 per share. The consensus estimate for PM suggests growth of 5.8% from the year-ago quarter’s reported figure.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.