Forecast Of The Day: Diageo North America Volumes

May 20th, 2021 by Trefis Team
+28.94%
Upside
120
Market
155
Trefis
DEO: Diageo logo
DEO
Diageo

What?

Trefis expects the total alcohol volumes sold by Diageo (NYSE:DEO) in North America (U.S. and Canada) to rise from 48.4 million in FY 2020 to 50.8 million equivalent units in FY 2021. An equivalent unit represents one nine-liter case of spirits.

Why?

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Volumes declined sharply in FY 2020 due to the lockdowns and the closing of bars and restaurants. However, volumes are expected to rise sharply this year as the economy continues to re-open further, with Covid cases on the decline.

So What?

Higher volumes in North America should bode well for Diageo’s profitability, as average price realizations and margins from the region are meaningfully higher than the company average.

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