Is a Johnnie Walker Hard Seltzer What's Missing for Diageo?

The coronavirus pandemic revealed a major weakness in the business model of Diageo (NYSE: DEO), namely that its operations are too tied to restaurants, bars, and clubs. Because of the shutdown caused by the pandemic, 20% of Diageo's North American business was put at risk, as was 50% of its European business.

Although package-good stores remained open during the crisis, analysts believe alcoholic beverages like Diageo's leading Johnnie Walker scotch and other spirits are more apt to be drunk by consumers when they're out on the town rather than at home. As a result, they see brewers being a better investment.

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Source Fool.com