Diageo's CEO Change Sparks Optimism

about 1 month ago

Louise Moon

"Indeed, being very much welcomed by the market. So, their new CEO Dave Lewis is a well-known name in the in the British business and particularly retail space. So, he spent most of his career at Uni Lever, but what he's really widely known for is turning Tesco around. So, he joined Tesco in 2014 as it was kind of reeling from an accounting scandal at the time. He came in, shed a lot of underperforming units and really boosted performance and then he ended his his time at Tesco as CEO in 2020. So he's known for his turnaround efforts which are much needed by Diageo at the moment. Last week they lowered their 4year outlook on a host of reasons including tariffs and changing demand for alcohol, as well as a period of management limbo following the departure of their former CEO. Their shares are down over 30% year to date, but this morning they are rising—a good move and positive surprise according to analysts."

Diageo is experiencing a turnaround catalyst with the appointment of renowned turnaround expert Dave Lewis. The appointment is seen as a positive move to address past underperformance and management issues. Despite a down year with shares dropping over 30%, the market is reacting positively this morning, driven by expectations that Lewis will improve operational performance.

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