DiageoFRA:GUI -0.74%67 Debt-to-EBITDA is 3.12 as of Dec. 2025, which is 15% above its 10-year median of 2.72. GuruFocus rates FRA:GUI with a GF Score™ of 67/100 and a GF Value™ of €27.87 (Significantly Undervalued). The stock has 5 warning signs investors should review. Among 158 Beverages - Alcoholic companies, Diageo ranks worse than 65.82% on this metric.
Debt-to-EBITDA measures a company's ability to pay off its debt.
A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt. According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.
The historical rank and industry rank for Diageo's Debt-to-EBITDA or its related term are showing as below:
FRA:GUI'
s Debt-to-EBITDA Range Over the Past 10 Years
Min: 2.11 Med: 2.72 Max: 3.88
Current: 3.7
During the past 13 years, the highest Debt-to-EBITDA Ratio of Diageo was 3.88. The lowest was 2.11. And the median was 2.72.
FRA:GUI's Debt-to-EBITDA is ranked worse than 65.82% of 158
companies
in the Beverages - Alcoholic industry
Industry Median: 2.305
vs FRA:GUI: 3.70
A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt.
According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.
Diageo Debt-to-EBITDA Related Terms
Diageo Debt-to-EBITDA Historical Data
* Premium members only.
The historical data trend for Diageo's Debt-to-EBITDA can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Beverages - Wineries & Distilleries subindustry, Diageo's Debt-to-EBITDA, along with its competitors' market caps and Debt-to-EBITDA data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Diageo Debt-to-EBITDA vs Beverages - Alcoholic Industry
For the Beverages - Alcoholic industry and Consumer Defensive sector, Diageo's Debt-to-EBITDA distribution charts can be found below:
* The bar in red indicates where Diageo's Debt-to-EBITDA falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual Debt-to-EBITDA, the EBITDA of the last fiscal year is used. In calculating the annualized quarterly data,
the EBITDA data used here is two times the quarterly (Dec. 2025) EBITDA data.
Diageo (FRA:GUI) has a Debt-to-EBITDA of 3.12 as of Dec. 2025. Debt-to-EBITDA ratio represents the ratio of total debt to total earnings before interest, taxes, depreciation and amortization. View historical data on Diageo. This is 15% above median its historical median of 2.72. Over the past decade, Diageo's Debt-to-EBITDA has ranged from 2.11 to 3.88. According to the industry distribution chart, Diageo ranks #104 out of 158 companies in the Beverages - Alcoholic industry, placing it in the top 65.8%.
Is Diageo's Debt-to-EBITDA too high?
Diageo's current Debt-to-EBITDA of 3.12 is 15% above median its 10-year median of 2.72. Over the past 10 years, this metric has ranged from a low of 2.11 to a high of 3.88. The Beverages - Alcoholic industry median Debt-to-EBITDA is 2.31. Diageo's value of 3.12 is 35.4% above this industry median. Based on the distribution chart, Diageo ranks #104 out of 158 companies in the Beverages - Alcoholic industry, which is below the industry midpoint. Overall, Diageo has a GF Score™ of 67/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Diageo's Debt-to-EBITDA compare to BF.B?
According to the Beverages - Alcoholic industry distribution chart, Diageo ranks #104 out of 158 companies for Debt-to-EBITDA. This places Diageo in the lower half of its industry. The industry median Debt-to-EBITDA is 2.31. Diageo's value of 3.12 is 35.4% above this benchmark. Historically, Diageo's own Debt-to-EBITDA has ranged from 2.11 to 3.88 over the past decade. While the company's 10-year median is 2.72 vs. the industry median of 2.31, Diageo has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Debt-to-EBITDA for a Beverages - Alcoholic company?
The median Debt-to-EBITDA among Beverages - Alcoholic companies is 2.31, based on 158 companies in the industry. Companies in the top quartile (top 25%) have a Debt-to-EBITDA significantly above this median, while those in the bottom quartile fall well below. However, Debt-to-EBITDA should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Diageo's current Debt-to-EBITDA of 3.12 is 35.4% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Debt-to-EBITDA mean?
A high Debt-to-EBITDA can signal that a stock is expensive relative to its fundamentals. Debt-to-EBITDA ratio represents the ratio of total debt to total earnings before interest, taxes, depreciation and amortization. View historical data on Diageo. For the Beverages - Alcoholic industry, the median Debt-to-EBITDA is 2.31 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Diageo's current Debt-to-EBITDA is 3.12, which is 15% above median its own 10-year median of 2.72. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Diageo stock overvalued right now?
Based on GuruFocus' analysis, Diageo (FRA:GUI) is currently considered Significantly Undervalued. The stock's GF Value™ is €27.87, compared to a current price of €18.15 — trading 34.9% below its estimated fair value. The current Debt-to-EBITDA is 3.12, which is 15% above median its 10-year median of 2.72 and 35.4% above the Beverages - Alcoholic industry median of 2.31. Diageo's overall GF Score™ is 67/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Debt-to-EBITDA calculated?
Debt-to-EBITDA is calculated from a company's financial statements. For Diageo (FRA:GUI), the current Debt-to-EBITDA is 3.12 as of Dec. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Diageo (FRA:GUI) Overvalued in 2026?
Based on GuruFocus' analysis, Diageo stock appears to be undervalued.
The current stock price of €18.15 is trading 34.9% below its estimated GF Value™ of €27.87.
GuruFocus considers Diageo to be Significantly Undervalued.
Key valuation signals for FRA:GUI:
Debt-to-EBITDA: 3.12 (15% above median its 10-year median of 2.72)
GF Value™: €27.87 vs. price of €18.15 (34.9% below fair value)
Industry Position: 35.4% above the Beverages - Alcoholic median (#104 of 158)
No single metric tells the full story. See the FRA:GUI stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Formed in 1997 through the merger of Grand Metropolitan and Guinness, Diageo is the largest distiller globally by sales. Diageo acquired some of the Seagram assets in 2001, which gave it brands such as Captain Morgan rum and Crown Royal Canadian whisky. Since then, mergers and acquisitions have mostly been bolt-on in nature, plugging gaps in the company's product and geographic portfolio.
67GF Score
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