12 Worst Depressed Stocks To Buy Now

2. Diageo plc (NYSE:DEO)

52 Week Range: 105.72 – 149.44

Current Share Price: $107.65 

Analyst Upside Potential: 20.42%

1-Year Performance: -25.88%

Number of Hedge Fund Holders: 26 

Diageo plc (NYSE:DEO) is a British multinational company specializing in the production, distribution, and marketing of alcoholic beverages. It operates globally, with sales in over 180 countries and a portfolio of approximately 200 brands. The company is one of the largest players in the alcoholic beverage industry and owns iconic brands such as Johnnie Walker, Smirnoff, Baileys, and Captain Morgan.

On March 13, Bernstein analyst Nadine Sarwat maintained a Buy rating on the stock with a price target of £27.70. During the first half of 2025, the company, despite a challenging environment,  saw a return to organic net sales growth of 1%, with growth in four out of five regions, including North America. Management noted that they were able to maintain a 65% market share of its net sales in measured markets. The market has been challenging for Diageo plc (NYSE:DEO) as consumers are cautious due to economic pressures and opting for smaller pack sizes. Moreover, Super premium plus priced products are driving growth, while premium and below core price products are declining. Despite the progress, the stock has fallen more than 25% over the 12 months thereby making it one of the worst depressed stocks to buy now.

Ariel Appreciation Fund stated the following regarding Diageo plc (NYSE:DEO) in its Q4 2024 investor letter:

“During the quarter, we initiated three new investments, each in companies we have followed closely for a considerable time. At various points, we viewed them as missed opportunities; however, our experience with Mr. Market has taught us that patience often creates inevitable entry points. This quarter, some exciting opportunities presented themselves. The three investments are Amazon (NASDAQ: AMZN), Diageo plc (NYSE:DEO), and Uber (NASDAQ: UBER). We will discuss each in detail below

COVID was a bonanza for spirits companies, but the aftermath has proven challenging. The retail channel became over-inventoried, and as the on-trade (industry lingo for restaurants and bars) restocked their shelves and consumers returned to in-person gatherings, tough comparables led to slower growth rates— or even declines. In the stock market, Diageo serves as the bellwether for the spirits industry, and its woes began with questions about when the industry might return to growth. These challenges have since been compounded by a series of emergent narratives that weigh heavily on the stock today. These narratives include, but are not limited to, concerns about GLP-1 drugs altering behavior, Gen Z imbibing less than prior generations, economic struggles in emerging markets like Latin America and China, and fears of harsher regulations and warnings for the industry.…” (Click here to read the full text)