This post was originally published on this site
https://i-invdn-com.investing.com/news/LYNXMPEB3108I_M.jpgThe maker of Johnnie Walker whisky and Tanqueray gin previously flagged earlier this year that a COVID-induced boost in demand in the U.S. for pricier alcoholic drinks used for cocktails is showing signs of slowing.
This normalization of growth levels, along with a weakening macroeconomic outlook, may impact performance in Diageo’s key U.S. market, the Jefferies analysts said. The U.S. business makes up nearly 40% of sales and close to 50% of profits, according to the analysts.
They projected that organic sales in the country are now expected to grow by only 1% in the 2024 financial year, well below consensus estimates of 4.5%.
Diageo stock could subsequently “tread water” as the pandemic-era surge in U.S. sales wanes, they argued.