Down 55%, Is Now the Time to Buy Diageo Shares for My ISA?
Diageo shares (LSE: DGE) have hit a 10-year low, dropping more than 50% since early 2022. This decline contrasts sharply with the FTSE 100 index, which has risen around 30% in the same period. Investors could have earned much better returns elsewhere in the FTSE 100.
From personal experience, I owned Diageo shares in my Stocks and Shares ISA until the start of this year. Since selling, the stock has fallen an additional 27%, making it even cheaper and boosting its dividend yield.
Should I Reintroduce Diageo to My Portfolio?
The company boasts a portfolio of top-tier brands:
- Johnnie Walker
- Tanqueray
- Gordon’s
- Smirnoff
- Don Julio
- Baileys
- Guinness
Seeing this list raises the question: how can the stock be down 55% in under four years? This is crucial to determining if there is a great buying opportunity.
"Nobody seems to be sure why exactly sales across the alcohol industry are in the doldrums."
The current slump in Diageo’s shares highlights uncertainty in the alcohol market, despite the firm's strong brand lineup and attractive dividend yield.
Author's Summary
This significant stock drop challenges investors to weigh the potential of Diageo's top brands against the unclear reasons behind the alcohol sector's slowdown.