Peter Lynch Fair Value applies to growing companies. The ideal range for the growth rate is between 10 - 20% a year. Peter Lynch thinks that the fair P/E value for a growth company equals its growth rate, that is PEG = 1. The earnings here is trailing twelve month (TTM) earnings. For non-bank companies, the growth rate we use is the average growth rate for EBITDA per share over the past 5 years. For Banks, the growth rate we use is the average growth rate for Book Value per share over the past 5 years. If 5-Year Growth Rate is greater than 25% a year, we use 25. If 5-Year Growth Rate is smaller than 5% a year, we do not calculate Peter Lynch Fair Value.
The historical rank and industry rank for Diageo's Peter Lynch Fair Value or its related term are showing as below:
During the past 13 years, the highest Price to Peter Lynch Fair Value Ratio of Diageo was 5.35. The lowest was 2.35. And the median was 3.91.
HAM:GUI's Price-to-Peter-Lynch-Fair-Value is not ranked *
in the Beverages - Alcoholic industry.
Industry Median: 1.665 * Ranked among companies with meaningful Price-to-Peter-Lynch-Fair-Value only.
Note: Please don't confuse Peter Lynch Fair Value with the value reached in Peter Lynch Chart.
Diageo (HAM:GUI) Peter Lynch Fair Value Explanation
Peter Lynch Fair Value applies to growing companies. The ideal range for the growth rate is between 10 - 20% a year.
Peter Lynch thinks that the fair P/E value for a growth company equals its growth rate, that is PEG = 1. The earnings here is trailing twelve month (TTM) earnings. For non-bank companies, the growth rate we use is the average growth rate for EBITDA per share over the past 5 years. For Banks, the growth rate we use is the average growth rate for Book Value per share over the past 5 years.
Please don't confuse Peter Lynch Fair Value with the value reached in Peter Lynch Chart. In Peter Lynch chart, a fixed P/E ratio of 15 is used to draw the Earnings Line. Therefore the value reached has a P/E ratio of 15. But in Peter Lynch Fair Value calculation, P/E equals to the growth rate of EBITDA per share over the past 5 years, which is 0 instead of 15 in this case.
Diageo's Price to Peter Lynch Fair Value Ratio for today is calculated as
Price to Peter Lynch Fair Value
=
Share Price
/
Peter Lynch Fair Value
=
18.27
/
N/A
=
N/A
* 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 Peter Lynch Fair Value Related Terms
Diageo Peter Lynch Fair Value Historical Data
* Premium members only.
The historical data trend for Diageo's Peter Lynch Fair Value 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.
HAM:GUI vs BF.B: Peter Lynch Fair Value Comparison
For the Beverages - Wineries & Distilleries subindustry, Diageo's Price-to-Peter-Lynch-Fair-Value, along with its competitors' market caps and Price-to-Peter-Lynch-Fair-Value 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 Price-to-Peter-Lynch-Fair-Value vs Beverages - Alcoholic Industry
For the Beverages - Alcoholic industry and Consumer Defensive sector, Diageo's Price-to-Peter-Lynch-Fair-Value distribution charts can be found below:
* The bar in red indicates where Diageo's Price-to-Peter-Lynch-Fair-Value falls into.
For company reported semi-annually, GuruFocus uses latest annual data as the TTM data. Diageo's EPS without NRI for the trailing twelve months (TTM) ended in Dec. 2025 was €1.42.
* 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.
** Please be aware that the 5-Year TTM EBITDA Growth Rate is calculated based on TTM data over the last 5 years. For quarterly reported companies, the TTM data adds up the quarterly data reported by the company within the most recent 12 months. For companies that report semi-annually, annually, or do not have enough quarterly data, GuruFocus uses the annual data as the TTM data.
If 5-Year Earnings Growth Rate is greater than 25% a year, we use 25.
If 5-Year Earnings Growth Rate is smaller than 5% a year, we do not calculate Peter Lynch Fair Value.
Please note that we use the 5-year average growth rate of EBITDA per share as the growth rate for non-bank companies, as EBITDA growth is subject to less manipulations than net earnings per share. For banks, we use the 5-year average growth rate of Book Value per share as the growth rate. The reason is that EBITDA is not applicable to Banks and Book value is a relative important measurement for Banks. In the calculation, PEG=1 because Peter Lynch thinks that the fair P/E ratio of the growth stock is equal to its earnings growth rate.
Is Diageo (HAM:GUI) Overvalued in 2026?
Based on GuruFocus' analysis, Diageo stock appears to be undervalued.
The current stock price of €18.27 is trading 34.5% below its estimated GF Value™ of €27.88.
GuruFocus considers Diageo to be Significantly Undervalued.
Key valuation signals for HAM:GUI:
Peter Lynch Fair Value: N/A
GF Value™: €27.88 vs. price of €18.27 (34.5% below fair value)
No single metric tells the full story. See the HAM: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
Get the complete analysis for HAM:GUI
Peter Lynch Fair Value is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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