Diageo stock (NYSE: DEO) has declined almost 10% in the last one month, underperforming the S&P 500 which was down 9%. If you look at the change over the last one week and ten days, DEO stock is down 3.2% and 5.6%, respectively. The stock is now trading below $200, a level it has not fallen to since October 2021. The decline in the stock was driven by a sudden spike in Covid cases and re-imposition of restrictions to a certain extent in various countries. Additionally, the larger decline in global stock markets over the last few days, especially due to expectations of rise in U.S. interest rates and geopolitical challenges (Russia-Ukraine trouble) has also driven DEO stock down.
Now, is DEO stock set to drop further or could we expect some recovery? We believe that there is a 77% chance of a rise in DEO stock over the next month (21 trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on DEO Stock Chance of Rise.
Twenty-One Day: DEO -9.9%, vs. S&P500 -9.3%; Underperformed market
(1% likelihood event; 77% probability of rise over next 21 days)
- DEO stock decreased 9.9% the last twenty-one trading days (one month), compared to a broader market (S&P500) drop of 9.3%
- A change of -9.9% or more over twenty-one trading days is a very rare event with a 1% likelihood, which has occurred 31 times out of 2515 in the last 10 years
- Of these 31 instances, the stock has seen a positive movement over the next twenty-one trading days on 24 occasions
- This points to a 77% probability for the stock rising over the next twenty-one trading days
Ten Day: DEO -5.6%, vs. S&P500 -7.8%; Outperformed market
(4% likelihood event; 56% probability of rise over next 10 days)
- DEO stock decreased 5.6% over the last ten trading days (two weeks), compared to broader market (S&P500) drop of 7.8%
- A change of -5.6% or more over ten trading days is a 4% likelihood event, which has occurred 93 times out of 2516 in the last 10 years
- Of these 93 instances, the stock has seen a positive movement over the next ten trading days on 52 occasions
- This points to a 56% probability for the stock rising over the next ten trading days
Five Day: DEO -3.2%, vs. S&P500 -4.1%; Outperformed market
(8% likelihood event; 62% probability of rise over next five days)
- DEO stock decreased 3.2% over a five-day trading period ending 01/26/2022, compared to the broader market (S&P500) drop of 4.1%
- A change of -3.2% or more over five trading days (one week) is an event with 8% likelihood, which has occurred 204 times out of 2516 in the last ten years
- Of these 204 instances, the stock has seen a positive movement over the next five trading days on 127 occasions
- This points to a 62% probability for the stock rising over the next five trading days
We estimate Diageo’s valuation to be around $210 per share, which is close to 6% above its current market price.
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