DiageoFRA:GUI +1.59%67 Operating Margin % is 29.79% as of Dec. 2025, which is 1% above its 10-year median of 29.42. GuruFocus rates FRA:GUI with a GF Score™ of 67/100 and a GF Value™ of €27.76 (Significantly Undervalued). The stock has 5 warning signs investors should review. Among 211 Beverages - Alcoholic companies, Diageo ranks better than 87.2% on this metric.
Operating Margin % is calculated as Operating Income divided by its Revenue. Diageo's Operating Income for the
six
months ended in Dec. 2025 was €2,661 Mil. Diageo's Revenue for the
six
months ended in Dec. 2025 was €8,933 Mil. Therefore, Diageo's Operating Margin % for the quarter that ended in Dec. 2025 was 29.79%.
Warning Sign:
Diageo PLC operating margin has been in a 5-year decline. The average rate of decline per year is -4.6%.
The historical rank and industry rank for Diageo's Operating Margin % or its related term are showing as below:
FRA:GUI'
s Operating Margin % Range Over the Past 10 Years
Min: 21.41 Med: 29.42 Max: 31.41
Current: 21.75
FRA:GUI's Operating Margin % is ranked better than 87.2% of 211
companies
in the Beverages - Alcoholic industry
Industry Median: 7.82
vs FRA:GUI: 21.75
Diageo's 5-Year Average Operating Margin % Growth Rate was -4.60% per year.
Diageo's Operating Income for the
six
months ended in Dec. 2025 was €2,661 Mil.
Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2025 was €3,684 Mil.
Diageo (FRA:GUI) Operating Margin % Explanation
Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.
Be Aware
Operating Margin % can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).
If a company is facing competition, its Operating Margin % may decline. Often the Operating Margin % declines well before the company's Revenue or even profit decline. Therefore, Operating Margin % is a very important indicator of whether the company is facing problems.
For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokias Operating Margin % had already been in decline since 2002, although its Earnings per Share (Diluted) were still rising. Investors who paid attention to Operating Margin % would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).
Therefore, Operating Margin % is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.
Diageo Operating Margin % Related Terms
Diageo Operating Margin % Historical Data
* Premium members only.
The historical data trend for Diageo's Operating Margin % 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 Operating Margin %, along with its competitors' market caps and Operating Margin % 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 Operating Margin % vs Beverages - Alcoholic Industry
For the Beverages - Alcoholic industry and Consumer Defensive sector, Diageo's Operating Margin % distribution charts can be found below:
* The bar in red indicates where Diageo's Operating Margin % falls into.
Operating Margin % - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.
Diageo's Operating Margin % for the fiscal year that ended in Jun. 2025 is calculated as
* 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.
Diageo (FRA:GUI) has a Operating Margin % of 29.79% as of Dec. 2025. Operating margin is the ratio of total operating income to net sales. View historical data on Diageo and its competitors. This is near median its historical median of 29.42. Over the past decade, Diageo's Operating Margin % has ranged from 21.41 to 31.41. According to the industry distribution chart, Diageo ranks #27 out of 211 companies in the Beverages - Alcoholic industry, placing it in the top 12.8%.
Is Diageo's Operating Margin % too high?
Diageo's current Operating Margin % of 29.79% is near median its 10-year median of 29.42. Over the past 10 years, this metric has ranged from a low of 21.41 to a high of 31.41. The Beverages - Alcoholic industry median Operating Margin % is 7.82. Diageo's value of 29.79% is 280.9% above this industry median. Based on the distribution chart, Diageo ranks #27 out of 211 companies in the Beverages - Alcoholic industry, which is in the top quartile — a strong position relative to peers. 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 Operating Margin % compare to BF.B?
According to the Beverages - Alcoholic industry distribution chart, Diageo ranks #27 out of 211 companies for Operating Margin %. This places Diageo in the top 13% of its industry — outperforming the majority of peers. The industry median Operating Margin % is 7.82. Diageo's value of 29.79% is 280.9% above this benchmark. Historically, Diageo's own Operating Margin % has ranged from 21.41 to 31.41 over the past decade. While the company's 10-year median is 29.42 vs. the industry median of 7.82, 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 Operating Margin % for a Beverages - Alcoholic company?
The median Operating Margin % among Beverages - Alcoholic companies is 7.82, based on 211 companies in the industry. Companies in the top quartile (top 25%) have a Operating Margin % significantly above this median, while those in the bottom quartile fall well below. However, Operating Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Diageo's current Operating Margin % of 29.79% is 280.9% 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 Operating Margin % mean?
A high Operating Margin % can signal that a stock is expensive relative to its fundamentals. Operating margin is the ratio of total operating income to net sales. View historical data on Diageo and its competitors. For the Beverages - Alcoholic industry, the median Operating Margin % is 7.82 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Diageo's current Operating Margin % is 29.79%, which is near median its own 10-year median of 29.42. 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 €27.76, compared to a current price of €18.19 — trading 34.5% below its estimated fair value. The current Operating Margin % is 29.79%, which is near median its 10-year median of 29.42 and 280.9% above the Beverages - Alcoholic industry median of 7.82. 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 Operating Margin % calculated?
Operating Margin % is calculated from a company's financial statements. For Diageo (FRA:GUI), the current Operating Margin % is 29.79% 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 €18.19 is trading 34.5% below its estimated GF Value™ of €27.76.
GuruFocus considers Diageo to be Significantly Undervalued.
Key valuation signals for FRA:GUI:
Operating Margin %: 29.79% (near median its 10-year median of 29.42)
GF Value™: €27.76 vs. price of €18.19 (34.5% below fair value)
Industry Position: 280.9% above the Beverages - Alcoholic median (#27 of 211)
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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