Citi lifted its price target on Diageo on Thursday to 3,325p from 3,200p following the drinks maker’s trading update.
The bank said it has updated its Diageo model “to take account of the surprise trading update and new share buyback programme”.
It lifted its FY21 organic EBIT growth estimate to +15.1% from +12.2% previously. Citi also increased its FY21 clean earnings per share estimate by 2.2% to 116.3p and its FY22 EPS estimate by 1.1% to 128.4p, versus consensus of 125.8p.
“Having lagged other beverage stocks through Q1 earnings season and given further evidence of impressive trading momentum and the robustness of spirits business models, we are not surprised by the positive share price reaction,” it said.
Citi maintained its ‘neutral’ rating on the shares.
