(News Bulletin 247) – Jefferies announced on Friday that it had downgraded its recommendation on Diageo shares from ‘buy’ to ‘hold’ with a price target reduced from 4,000 to 3,800 pence.
In a research note, the analyst hails the attractive fundamentals of the wine and spirits group over the long term, but believes that the market will have to immediately take into account the prospect of a slowdown in growth in the USA.
While the consensus is counting on organic growth of 4.5% on the American market for the 2023/2024 fiscal year, the intermediary says he is counting on a much more limited increase in activity of the order of 1%.
According to Jefferies, this slowdown reflects the logical ‘normalization’ of the sector following the exceptional performance recorded during the pandemic, but also a risk of inventory adjustment and economic downturn.
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