Premium content from Motley Fool Share Advisor UK
Our monthly Ice Best Buys Now are designed to highlight our team’s three favourite, most timely Buys from our growing list of income-focused Ice recommendations, to help Fools build out their portfolios.
“Best Buys Now” Pick #1:
Diageo (LSE:DGE)
- While Diageo was formed in 1997, the history of many of its famous brands stretches back much further. Its six top brands were founded between 1759 and 1974 – showing strong staying power.
- Diageo produced 6.5% sales growth to £17.1bn in its latest fiscal year, despite weak volume performance, as the company passed through price increases.
- New CEO Debra Crew, who replaces the late Sir Ivan Menezes, is expected to continue to take “strategic pricing actions”, reflecting Diageo’s brand strength and its reliance on high-income customers.
- Its performance reflects its outstanding portfolio, continued investment in brand-building, and its agile supply chain.
- Some 60% of net sales are estimated at being from the premium-plus segment – such as Aviation American Gin and 21Seeds flavoured tequila – potentially providing some resilience to the macroeconomic environment.
- The company currently offers a trailing yield of 2.6%.
