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Diageo urged to expand beyond premium spirits to attract budget-conscious consumers, says Jefferies.

Market News
08 Jun 2026
Proactive Investors
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Neutral
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Jefferies raised its target price for Diageo to £20, highlighting the company's heavy focus on premium spirits as a weakness amid budget pressures on consumers. The report suggests Diageo should broaden its product range to include more affordable options, smaller pack sizes, and ready-to-drink products to appeal to those trading down. Analysts expect a strategy update on August 6 to clarify the recovery plan, forecasting low single-digit sales growth and improved returns by 2028 after a transition year in 2027. Despite challenges, Jefferies maintains a 'buy' rating, noting Diageo shares trade at a significant discount compared to historical valuations and sector peers.

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