Diageo plc

In trading on Tuesday, shares of Diageo plc (Symbol: DEO) crossed above their 200 day moving average of $112.51, changing hands as high as $114.39 per share. Diageo plc shares are currently trading up about 3% on the day. The chart below shows the one year performance of DEO shares, versus its 200 day moving average:
Looking at the chart above, DEO's low point in its 52 week range is $96.4501 per share, with $142.73 as the 52 week high point — that compares with a last trade of $114.06.
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DEO Makes Bullish Cross Above Critical Moving Average

For Immediate Release
Chicago, IL – August 19, 2025 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Fortis, Inc. FTS, New Jersey Resources Corp. NJR, ONE Gas, Inc. OGS and Diageo plc DEO.
Here are highlights from Monday’s Analyst Blog:
4 Low-Beta Defensive Stocks to Bank On as Consumer Sentiment Drops
Volatility has returned to Wall Street, with major indexes giving up gains over the past couple of months, as uncertainty over the next rate cut and the impact of President Donald Trump’s tariffs continue to dent consumer sentiment.
Consumer sentiment fell in July and inflation expectations rose due to these uncertainties. Given the uncertainty, it may be a wise decision to focus on safe-haven stocks such as utilities and consumer staples. In this regard, Fortis, Inc., New Jersey Resources Corp., ONE Gas, Inc. and Diageo plc appear to be attractive options. Each of these stocks carries a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Also, these stocks are from the low-beta category (beta greater than 0 but less than 1). Hence, the recommended approach is to invest in low-beta stocks with a high dividend yield and a favorable Zacks Rank.
Consumer Sentiment Falls Further
The University of Michigan's preliminary consumer sentiment index fell to 58.6% in July from a final reading of 61.7 in June, missing analysts’ expectations of a rise to 62. The reading for buying conditions fell 14%, the lowest in a year.
The survey mentioned that households are expecting prices of goods to rise due to higher tariffs, which is denting their sentiment. The short-term inflation expectations worsened, with the projected 12-month inflation outlook rising to 4.9% in July from 4.5% in June.
The five-year inflation outlook also rose to 3.9% in July from 3.4% in the prior month.
Multiple Factors Denting Sentiment
Stocks rallied over the past couple of months, with the Dow, the S&P 500 and the Nasdaq hitting multiple new all-time closing highs, after Trump halted tariffs and the White House initiated trade talks with several countries to reach fair trade deals.
This gave investor sentiment a boost on optimism that the impact of tariffs would not be milder than it was initially believed. However, prices of goods rose substantially after the new tariffs were implemented. Also, the tariff deadline ended on Aug. 7, and consumers are anticipating prices to rise further.
Investors were also expecting a rate cut in July, but the Federal Reserve left interest rates unchanged in its current range of 4.25-4.5%. The Fed has adopted a wait-and-watch stance, as it is also unsure how tariffs will impact inflation. Investors are now anticipating a 25-basis point rate cut in September, but no such indication has been given by the Federal Reserve.
These uncertainties could keep markets volatile for a longer period.
4 Low-Beta Defensive Stocks with Upside
Fortis
Fortis, Inc. is engaged in the electric and gas utility business. FTS offers regulated utilities, comprising electric and gas, as well as engages in non-regulated hydroelectric operations. Fortis operates primarily in Canada, the United States and the Caribbean.
Fortis has an expected earnings growth rate of 4.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.2% over the last 60 days. FTS has a Zacks Rank #2. Fortis has a beta of 0.46 and a current dividend yield of 3.51%.
New Jersey Resources
New Jersey Resources Corp. is an energy services holding company, which, through its subsidiaries, provides safe and reliable natural gas and clean energy services, including transportation, distribution, asset management and home services. NJR operates through four segments: Natural Gas Distribution, Clean Energy Ventures, Energy Services, and Storage and Transportation.
New Jersey Resources has an expected earnings growth rate of 12% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.9% over the last 60 days. NJR presently sports a Zacks Rank #1. New Jersey Resources has a beta of 0.64 and a current dividend yield of 3.83%.
ONE Gas
ONE Gas, Inc. is a 100% regulated natural gas distribution utility. OGS provides natural gas distribution services to more than 2.3 million customers in Oklahoma, Kansas and Texas.
ONE Gas has an expected earnings growth rate of 10.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.9% over the last 60 days. The Zacks Rank #2 company has a beta of 0.82 and a current dividend yield of 3.54%.
Diageo
Diageo plc operates in approximately 180 countries and is involved in producing, distilling, brewing, bottling, packaging, as well as distributing spirits, wine and beer. DEO offers its products under globally recognized flagship brands, such as Smirnoff, Johnnie Walker, Captain Morgan, Baileys, Buchanan’s, J&B, Tanqueray and Guinness.
Diageo has an expected earnings growth rate of 3.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.2% over the last 60 days. Currently, DEO has a Zacks Rank #2. Diageo has a beta of 0.53 and a current dividend yield of 2.87%.
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The Zacks Analyst Blog Highlights Fortis, New Jersey Resources, ONE Gas and Diageo

An updated edition of the June 25, 2025, article.
When it comes to stock market investing, many investors gravitate toward companies with a clean, socially responsible image. But there is another corner of the market that, while morally controversial, has a record of delivering robust returns: sin stocks. Understanding how this niche operates, along with its potential rewards and risks, is essential before deciding if it aligns with your investment strategy.
Sin stocks are shares of companies in industries often viewed as unethical, immoral, or socially harmful. Despite their stigma, these businesses often generate steady profits, thanks to persistent demand. Common categories include alcohol, tobacco, cannabis and gambling. They are controversial due to perceived social costs, such as public health risks, addiction issues and moral objections.
While frequently excluded from institutional portfolios on ethical grounds, sin stocks have cultivated a loyal following of contrarian investors drawn to their resilience and income potential. Their key differentiator is their defensive nature: even in recessions, demand for alcohol, tobacco and gambling tends to hold firm. This stability allows such companies to maintain strong pricing power, resilient profit margins and consistent cash flows, much of which is returned to shareholders through generous, often above-average dividends.
Historically, sin stocks have demonstrated recession resistance, performing well in both economic expansions and contractions. Their combination of stable demand, pricing strength and shareholder-friendly capital returns has made them an appealing choice for those willing to set aside ethical reservations in pursuit of reliable performance.
That said, investing in sin stocks carries its set of challenges. Industries like tobacco and gambling face criticism for their links to adverse health and social outcomes, which may conflict with personal or institutional values. They are also subject to heavy regulation, legal oversight and shifting political sentiment, all of which can influence profitability and long-term valuations. Additionally, negative public perception can dampen investor sentiment and restrict institutional ownership.
Ultimately, investors must carefully assess whether sin stocks align with their financial objectives and personal values.
Companies like Diageo Plc DEO and Las Vegas Sands LVS stand to gain from the evolving trends in their respective industries. While alcohol companies like Diageo remain committed to growing market share through innovation and premiumization, gambling stocks like Las Vegas Sands focus on property upgrades and strategic investments to propel growth.
Tracking the Trends in Sin Stock Sectors
Sin stocks, companies in industries such as alcohol, tobacco, gambling, cannabis and sometimes defense, have long fascinated investors for their resilience and controversy. Tracking trends in these sectors is crucial, as shifts in consumer behavior, regulation and global economics can significantly influence performance.
One key trend is the evolution of consumer preferences. For example, the alcohol sector is seeing a surge in premium and craft offerings, as well as growing demand for low- or no-alcohol alternatives. Tobacco companies are adapting to declining cigarette use by investing in vaping products and smokeless tobacco. Similarly, the cannabis industry is expanding rapidly in regions where legalization is gaining traction, creating both growth opportunities and volatility.
Regulatory developments remain a major driver. Stricter rules can raise operating costs or limit market access, while favorable policy changes, such as gambling legalization in some U.S. states, can open fresh revenue streams. International expansion also plays a role, with many companies diversifying into markets where regulations are less restrictive.
Investor sentiment toward sin stocks often runs counter to Environmental, Social, and Governance trends, but their defensive qualities and strong dividends keep them attractive to contrarian and income-focused investors. Monitoring product innovation, market expansion and policy shifts is essential for understanding where these sectors are headed and identifying which companies are best positioned to thrive.
If you are looking to capitalize on this trend, our Sin Stocks Screen makes it easy to identify high-potential stocks such as Turning Point Brands TPB, The Boston Beer Company Inc. SAM and MGM Resorts International MGM.
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Turning Point Brands is building a growth story around two core strengths: its portfolio of well-established brands and its expanding presence in next-generation product categories. Anchored by Stoker’s brand in value tobacco and Zig-Zag in smoking accessories, the company has developed strong brand equity and a broad retail footprint across North America.
In recent years, it has been steadily growing its Modern Oral segment, tapping into consumer trends favoring smoke-free, reduced-risk alternatives. This category is now a significant contributor to sales, underscoring TPB’s ability to adapt its offerings to shifting market demand. The company’s strategy centers on brand-led innovation, deeper market penetration and leveraging its efficient, asset-light operating model. With a healthy balance sheet and strong cash generation, TPB can reinvest in marketing, product development and regulatory compliance without compromising profitability.
TPB’s established distribution channels and category expertise provide a durable competitive edge, while the move into high-growth oral nicotine products creates a runway for expansion beyond its traditional markets. Together, these factors form a solid long-term investment case for the Zacks Rank #3 (Hold) company, built on resilience, brand strength and the ability to capture growth in both legacy and emerging segments. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Boston Beer maintains a strong competitive position in the U.S. craft beverage market, anchored by a diverse portfolio that spans beer, hard cider, hard tea and hard seltzer. With well-known brands like Samuel Adams, Twisted Tea, Truly, Angry Orchard, Dogfish Head and Sun Cruiser, the company is positioned to serve multiple consumer segments and adapt to shifting tastes.
Boston Beer’s long-term strategy emphasizes innovation, as seen in the launch of products like Sun Cruiser and continued investment in brand building to capture market share even in challenging industry conditions. A focus on operational efficiency and margin improvement supports the ability to reinvest in growth while maintaining financial resilience.
Looking ahead, Boston Beer aims to leverage its scale, brand strength and distribution reach to navigate a dynamic macroeconomic environment. The company’s multi-year margin enhancement initiatives, strong balance sheet, and disciplined capital allocation give it the flexibility to pursue opportunities while weathering cyclical demand pressures. By balancing a robust innovation pipeline with efficiency gains, the Zacks Rank #3 company is building a platform for sustainable growth in both traditional and “beyond beer” categories, positioning itself to benefit when industry demand improves and consumer preferences evolve toward premium, high-quality offerings.
MGM Resorts holds a leading position in global gaming and entertainment, supported by a diversified portfolio spanning Las Vegas Strip resorts, regional operations, international properties, and digital gaming ventures. The company is enhancing its competitive edge through targeted capital investments, including property remodels, expanded convention space and continued growth of its BetMGM joint venture in sports betting and iGaming.
Its strong presence in Macau through MGM China provides access to one of the world’s most lucrative gaming markets, while planned development in Japan creates long-term opportunities in Asia.
The Zacks Rank #3 company’s strategy focuses on driving operational efficiency, expanding high-margin digital and international businesses, and delivering premium guest experiences. A robust balance sheet and significant liquidity allow MGM to reinvest in growth while returning capital to shareholders through share repurchases. With a well-recognized brand, scale advantages, and multiple growth levers across traditional and emerging segments, MGM is positioned to generate sustainable earnings growth and strengthen its leadership in the global hospitality and gaming industry.
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Sin Stocks Worth Watching: The Perfect Mix of Growth & Resilience

Diageo plc (DEO) is scheduled to release preliminary results for fiscal 2025 on Aug. 5. The alcoholic beverage company, which reports on a half-yearly basis, posted top and bottom-line declines and lower organic operating profit in the first half of fiscal 2025.
DEO is expected to register a decline in the bottom line when it reports fiscal 2025 numbers. The Zacks Consensus Estimate for quarterly earnings has moved up a couple of cents in the past 30 days to $6.75 per share.
The consensus estimate for earnings indicates a decline of 2.3% from the year-ago quarter’s reported number. The consensus estimate for Diageo’s quarterly revenues is pegged at $20.4 billion, which indicates a rise of 0.7% from the figure reported in the prior-year quarter.
Diageo plc Price and EPS Surprise
Key Factors to Note
Diageo’s price-led strategy is a hallmark of its premiumization playbook, enabling it to deliver consistent revenue growth even in markets experiencing softer consumer demand. The company is refining its productivity program to drive efficiency across the business to bring sustainable growth. A key focus is balancing cost savings with strategic reinvestment, particularly in marketing and brand activation.
Diageo’s third-quarter fiscal 2025 results underscore its continued commitment to premiumization, reflected in strong organic net sales growth and a positive price/mix contribution. The company has leaned heavily into higher-end offerings across its core categories, particularly tequila, Guinness variants and strategic restocking of premium spirits in North America.
Diageo has been experiencing significant gains from improved price/mix, which have been aiding growth despite soft volume. In addition, this Zacks Rank #2 (Buy) company has introduced the first phase of its Accelerate program, which defines clear cash delivery goals as well as a controlled approach to operational excellence and cost efficiency.
However, the company's Asia-Pacific region has been witnessing softness due to downtrading and an unfavorable market mix, indicating that while its premiumization efforts are gaining ground, they remain sensitive to regional economic shifts and consumer affordability dynamics.
Diageo sees the near-term industry pressures to be highly macroeconomic-driven, with uncertainty hurting the timing and pace of recovery. On its lastearnings call management had reiterated organic net sales and operating profit views for fiscal 2025. In the second half of fiscal 2025, DEO continues to anticipate a sequential improvement in organic net sales growth compared with the first half. It still expects a slight drop in organic operating profit for the second half compared with the prior year, broadly in line with the decrease in the first half. This reflects the tariff impacts on results in fiscal 2025.
Stocks With the Favorable Combination
Here are a few companies, which according to our model, have the right combination of elements to beat on earnings this reporting cycle.
Nomad Foods (NOMD) has an Earnings ESP of +1.15% and a Zacks Rank of 2 at present. NOMD is likely to register bottom-line decline when it releases second-quarter 2025 results. The consensus estimate for Nomad Foods’ quarterly earnings has risen a penny in the past seven days to 44 cents per share, implying a drop of 6.4% from the year-ago quarter’s number. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for quarterly revenues is pegged at $888.2 million, which implies a rise of 9.6% from the figure reported in the year-ago quarter. NOMD delivered an earnings surprise of 3.2%, on average, in the trailing four quarters.
The Estée Lauder Companies Inc. (EL) currently has an Earnings ESP of +36.11% and a Zacks Rank of 3. The company is likely to register declines in the top and bottom lines when it reports second-quarter 2025 numbers. The consensus mark for revenues is pegged at $3.4 billion, which indicates a decrease of 12.2% from the figure reported in the year-ago quarter.
The Zacks Consensus Estimate for EL’s quarterly earnings per share of eight cents implies a sharp decline from 64 cents per share reported in the year-ago quarter. The consensus mark has gone up three cents in the past 30 days. EL has a trailing four-quarter earnings surprise of 107.4%, on average.
Monster Beverage (MNST) currently has an Earnings ESP of +0.37% and a Zacks Rank of 3. The company is expected to register growth in its top and bottom lines when it reports second-quarter 2025 results. The Zacks Consensus Estimate for MNST’s quarterly earnings has been stable in the last 30 days at 48 cents per share, indicating 17.1% growth from the year-ago quarter's number.
The consensus estimate for Monster Beverage’s quarterly revenues is pegged at $2.1 billion, implying a rise of 9.6% from the figure in the prior-year quarter. MNST reported a negative earnings surprise of 4.1%, on average, in the trailing four quarters.
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Diageo to Report FY25 Results: What Surprise Awaits Investors?

The Boston Beer Company, Inc. SAM posted second-quarter 2025 results, wherein the bottom line beat the Zacks Consensus Estimate and improved year over year. Meanwhile, the top line missed the Zacks Consensus Estimate but exceeded year over year. Despite industry-wide volume pressures, the company showcased resilience in the second quarter of 2025.
Depletions declined 5% due to economic uncertainty and unfavorable weather during key selling weeks. Nevertheless, SAM managed to grow market share in the first half, driven by its diversified portfolio of iconic brands, a robust innovation pipeline and a high-performing sales force. Encouraged by the success of its multi-year margin enhancement initiatives, management raised gross margin guidance, highlighting continued improvement in profitability.
The positive consumer response to its new Sun Cruiser innovation and solid first-half earnings performance reinforce confidence in achieving full-year financial targets.
The leading craft brewer reported second-quarter earnings per share of $5.45, surpassing the Zacks Consensus Estimate of $4.37 per share and improving 241% year over year.
The Boston Beer Company, Inc. Price, Consensus and EPS Surprise
Net revenues of $587.9 million rose 1.5% from the prior-year quarter and missed the Zacks Consensus Estimate of $597 million. The increase can be attributed to higher pricing and and favorable product mix, somewhat offset by lower volumes. Excluding excise taxes, the top line grew 1.8% year over year to $625.4 million.
Shares of Boston Beer rallied 7% in yesterday’s after-hours trading session following the upbeat second-quarter 2025 earnings report. This Zacks Rank #4 (Sell) company’s shares have gained 15% as compared to the industry’s 5% growth in the past month.
SAM Price Performance In The Past Month
Image Source: Zacks Investment Research
Analyzing SAM’s Quarterly Performance
Boston Beer reported a 0.8% year-over-year decline in shipment volume to 2.1 million barrels in the second quarter. The decline mainly resulted from lower volumes of Truly Hard Seltzer and Samuel Adams, partially offset by growth in Sun Cruiser and Dogfish Head brands. Meanwhile, depletions fell 5% year over year.
Year-to-date depletions through the 26 weeks ended June 28, 2025, are estimated to have declined 3% year over year.
As of June 29, 2025, distributor inventory averaged nearly four and a half weeks on hand compared with five weeks on hand as of the end of first-quarter 2025 and about three and a half weeks on hand at the end of second-quarter 2025. This indicates that inventory is at appropriate levels for each of its brands.
The gross profit improved 9.8% year over year to $292.5 million, whereas the gross margin expanded 380 basis points (bps) to 49.8% from 46% in the year-ago quarter. The gross margin improved, mainly driven by brewery efficiencies, procurement savings, price increases and a favorable product mix. These gains were partially offset by higher inflationary and tariff costs. The company’s gross margin included $5.7 million of shortfall fees and $2.6 million of non-cash expenses related to third-party production prepayments, impacting the gross margin negatively by 141 bps in the second quarter.
Advertising, promotional and selling expenses rose 10.7% in the second quarter to $15.5 million, owing to higher investments in media . General and administrative expenses declined 4.7% year over year to $2.3 million, primarily driven by lower salaries and benefits, including reduced incentive compensation.
SAM’s Financial Snapshot
As of June 28, 2025, Boston Beer had cash and cash equivalents of $212.4 million and total stockholders’ equity of $912.4 million. The company currently has $150 million in its line of credit, which, along with its cash position, will be sufficient to meet cash requirements.
SAM repurchased Class A common stocks worth $99.2 million in second-quarter 2025 and $11.3 million from June 30, 2025, through July 18, 2025. This brings the company’s total year-to-date share repurchases to $110.5 million. As of July 18, 2025, it had $317 million remaining under its current share repurchase authorization of $1.6 billion.
Expectations From Boston Beer in 2025
SAM has updated its full-year 2025 financial guidance and revised its estimate of the financial to exclude any potential impacts of tariffs. The updated outlook reflects lower volume expectations due to macroeconomic pressures on industry demand, offset by higher gross margin expectations resulting from stronger-than-anticipated brewery efficiencies in the first half of the year. While earnings per diluted share guidance remains unchanged from an operational standpoint, it now includes an updated estimated negative tariff impact of $0.96 to $1.28 per share, lower than the previously excluded estimate of $1.25 to $1.90 per share.
Depletions and shipments are expected to be down in the high single digits to down in the low single digits for 2025, as compared to down low single digits to up low single digits mentioned earlier. Price increases remain unchanged at 1% to 2%. The company anticipates that the current trend of shipments exceeding depletions will reverse in the second half of 2025. Due to the seasonal nature of the business, the third quarter typically sees significantly higher volume than the fourth. In the prior year, SAM was unable to fully meet demand in the second quarter, resulting in a catch-up of shipments during the third quarter. Given this dynamic and the tough comparison to the prior year, the company expects the bulk of the 2025 shipment reversal to take place in the third quarter, with shipment declines projected in the low- to mid-teens range.
SAM anticipates a gross margin of 46-47.3%, including tariffs for 2025, up from the previous estimate of 44% to 46.5%. Gross margin excluding tariffs is now projected to be 47% to 48%, up from the earlier range of 45% to 47%. The company's gross margin guidance includes the negative impacts of 100-140 bps from shortfall fees and non-cash expenses of third-party production pre-payments.
Advertising, promotional and selling expenses are anticipated to increase $30-$50 million. This projection does not include any change in freight expenses for the shipment of products to distributors. The company anticipates an effective tax rate of 29-30% for 2025. It envisions that GAAP earnings per share guidance, including tariffs, has increased to a range of $6.72 to $9.54, compared to the prior $6.10 to $9.25, while EPS excluding tariffs remains steady at $8.00 to $10.50.
Capital spending expectations have been reduced to $70 to $90 million, down from the prior range of $90 to $110 million, reflecting a more disciplined investment approach.
Stocks to Consider
We have highlighted three top-ranked stocks from the Consumer Staples sector, namely Vita Coco Company COCO, Zevia ZVIA and Diageo DEO.
Vita Coco produces and sells coconut water products under the Vita Coco brand name in the United States, Canada, Europe, the Middle East, Africa and the Asia Pacific. The company currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for COCO’s 2025 earnings and sales indicates growth of 12.5% and 6.5%, respectively, from the previous year’s reported figures. Vita Coco has a trailing four-quarter average earnings surprise of 28.2%.
Zevia is focused on addressing health challenges resulting from excess sugar consumption by offering a portfolio of zero-sugar, zero-calorie, naturally sweetened beverages. It presently has a Zacks Rank #2.
The Zacks Consensus Estimate for Zevia’s 2025 sales and EPS indicates growth of 3.4% and 48.4%, respectively, from the prior-year reported levels. ZVIA delivered a trailing four-quarter earnings surprise of 33.6%, on average.
Diageo is involved in producing, distilling, brewing, bottling, packaging and distributing spirits, wine and beer. DEO currently has a Zacks Rank #2.
The Zacks Consensus Estimate for Diageo’s 2025 sales implies growth of 0.7% from the previous year’s reported numbers. Meanwhile, DEO’s earnings estimate indicates a year-over-year decline of 2.3%.
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Boston Beer Q2 Earnings Beat & Raised '25 Outlook Fuel Stock Gains

The Coca-Cola Company KO has reported second-quarter 2025 results, with the bottom line surpassing the Zacks Consensus Estimate. Meanwhile, the top line missed the consensus mark. The company’s revenues and earnings per share (EPS) improved year over year. The results have benefited from continued business momentum, aided by enhanced pricing across markets. This quarter’s results once again highlight the strength of KO’s resilient, all-weather strategy.
Coca-Cola reported a comparable EPS of 87 cents in the second quarter, up 4% from the year-ago period. Comparable EPS also beat the Zacks Consensus Estimate of 83 cents. Unfavorable currency translations hurt the comparable EPS by 5 percentage points. Comparable currency-neutral earnings per share rose 9% year over year.
Revenues of $12.54 billion grew 1% year over year but missed the Zacks Consensus Estimate of $12.59 billion. Organic revenues rose 5% from the prior-year quarter, led by growth across all segments, except for Bottling Investments. Coca-Cola’s reported revenues benefited from growth across most operating segments, except for Latin America and Bottling Investments. The improved price/mix in the quarter was offset by lower concentrate sales and adverse currency rates.
For the second quarter of 2025, KO gained a global value share in the total non-alcoholic ready-to-drink beverages category.
Shares of Coca-Cola dipped nearly 1% in the pre-market trading session following the mixed second-quarter results. The Zacks Rank #2 (Buy) stock has risen 12.6% in the year-to-date period compared with the industry’s growth of 6.7%.
Image Source: Zacks Investment Research
Detailed Picture of KO’s Q2 Volume & Pricing
In the reported quarter, concentrate sales were down 1% year over year, while the price/mix improved 6%. The price/mix benefited from pricing actions across the marketplace and a favorable mix. The impacts of high-inflation markets were lower in second-quarter 2025 compared with the same period last year.
In the second quarter, concentrate sales were in line with unit case volume. Coca-Cola’s total unit case volume fell 1% year over year in the second quarter, led by declines in Mexico, India and Thailand, which more than offset growth in Central Asia, Argentina and China.
Our model predicted year-over-year organic revenue growth of 4.9% for the second quarter, with a 5.8% gain from the price/mix and a 0.9% decline in the concentrate sales volume.
CocaCola Company (The) Price, Consensus and EPS Surprise
Coming to the cluster-category performance, the unit case volume dipped 1% year over year for the sparkling soft drinks category. The trademark Coca-Cola’s unit volume dropped 1%, led by a decline in Latin America, offset by growth in EMEA. Coca-Cola Zero Sugar advanced 14%, aided by growth in all geographic operating segments. The sparkling flavors category declined 2% year over year, backed by a decline in the Asia Pacific, offset by growth in EMEA.
Volume for juice, value-added dairy and plant-based beverages was down 4% in the second quarter, led by growth in the Asia Pacific, offset by an improvement in Latin America.
Unit volume for the water, sports, coffee and tea category was flat year over year in the second quarter. Coca-Cola witnessed flat volume growth in the water category, as improvement in EMEA and the Asia Pacific was fully offset by a decline in Latin America. Sports drinks fell 3%, driven by declines in Latin America, negated by gains in North America. The coffee business rose 1% due to growth in the Asia Pacific. The tea volume was flat, backed by growth in EMEA, offset by declines in North America.
Peek Into KO’s Segmental Details
Reported revenues rose 3% year over year each for North America and the Asia Pacific, and improved 5% for EMEA. However, revenues declined 4% for Latin America and 8% for Bottling Investments.
Organic revenues improved 13% year over year in Latin America, 3% in North America, 4% in EMEA and 5% in the Asia Pacific. Meanwhile, organic revenues were down 2% in Bottling Investments.
Analyzing Coca-Cola’s Q2 Margins
In dollar terms, the operating income surged 63% year over year to $4.28 billion, including a 6-point impact of currency headwinds. Comparable operating income rose 8.5% year over year to $4.38 billion. Comparable currency-neutral operating income advanced 15% on strong organic revenue growth across most segments, effective cost management and the timing of marketing investments.
The operating margin of 34.1% in the second quarter expanded significantly from 21.3% in the prior-year quarter. The comparable operating margin expanded 193 bps to 34.7%. The comparable currency-neutral operating margin expanded 325 bps to 36%.
Our model predicted the second-quarter adjusted operating margin to contract 10 bps year over year to 32.7%, driven by a 30-bps increase in the SG&A expense rate.
KO’s Guidance for 2025
Management has reiterated its organic revenues guidance for 2025 and updated its EPS view. It anticipates organic revenue growth of 5-6% for 2025. Comparable net revenues are expected to include a 1-2% currency headwind based on current rates and hedge positions (compared with 2-3% currency headwind expected earlier). The guidance also includes a 1% negative impact of acquisitions, divestitures and structural changes. The company anticipates an underlying effective tax rate of 20.8% for 2025.
Comparable currency-neutral EPS for 2025 is expected to increase 8% year over year, at the mid-point of the prior-mentioned 7-9%. The company anticipates comparable EPS growth of 3% for 2025 from the $2.88 reported in 2024. The revised guidance is at the high-end of the prior mentioned 2-3%.
Comparable EPS growth is expected to include currency headwinds of 5% (compared with 5-6% headwind mentioned earlier). The EPS guidance also includes a 1% negative impact of acquisitions, divestitures and structural changes compared with a marginal impact mentioned earlier.
Management envisions an adjusted free cash flow of $9.5 billion for 2025, including $11.7 billion in cash flow from operations. Capital expenditure is likely to be $2.2 billion.
For third-quarter 2025, comparable revenues are expected to include a 1% currency headwind. Comparable EPS is estimated to include a 5-6% currency headwind.
Other Stocks to Consider
We have highlighted three other top-ranked stocks from the Consumer Staples sector, namely Vita Coco Company COCO, Zevia ZVIA and Diageo DEO.
Vita Coco produces and sells coconut water products under the Vita Coco brand name in the United States, Canada, Europe, the Middle East, Africa, and the Asia Pacific. The company currently has a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for COCO’s 2025 earnings and sales indicates growth of 12.5% and 6.5%, respectively, from the previous year’s reported figures. Vita Coco has a trailing four-quarter average earnings surprise of 28.2%.
Zevia is focused on addressing health challenges resulting from excess sugar consumption by offering a portfolio of zero sugar, zero calorie, naturally sweetened beverages. It presently has a Zacks Rank #2.
The Zacks Consensus Estimate for Zevia’s 2025 sales and EPS indicates growth of 3.4% and 48.4%, respectively, from the prior-year reported levels. ZVIA delivered a trailing four-quarter earnings surprise of 33.6%, on average.
Diageo is involved in producing, distilling, brewing, bottling, packaging and distributing spirits, wine and beer. DEO currently has a Zacks Rank #2.
The Zacks Consensus Estimate for Diageo’s 2025 sales implies growth of 0.7% from the previous year’s reported numbers. Meanwhile, DEO’s earnings estimate indicates a year-over-year decline of 2.3%.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Coca-Cola Beats on Earnings in Q2, But Falls Short on Revenues

(RTTNews) - Diageo plc (DEO, DGE.L), a provider of alcoholic beverages, announced Wednesday that Debra Crew has stepped down as Chief Executive Officer and as a Board Director with immediate effect, by mutual agreement.
The Board has begun a comprehensive formal search process, which will include consideration of internal and external candidates. Until a permanent appointment is made, Nik Jhangiani, Chief Financial Officer, will assume the role of Chief Executive Officer on an interim basis.
Crew has led Diageo as Chief Executive Officer since June 2023, having joined Diageo as a non-executive director in 2019, then serving as President of Diageo North America and subsequently as Group Chief Operating Officer.
Crew was previously Chief Operating Officer of the company from October 2022 to June 2023, and she also served as President, North America and Global Supply, Diageo plc from July 2020 to September 2022.
The company said the guidance for fiscal 2025 and 2026 remains unchanged from what was shared on May 19, 2025 in the third quarter Trading Statement.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Diageo Names Nik Jhangiani As Interim CEO After CEO Debra Crew Steps Down

Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the First Trust Value Line Dividend Index Fund ETF (Symbol: FVD), we found that the implied analyst target price for the ETF based upon its underlying holdings is $48.99 per unit.
With FVD trading at a recent price near $44.36 per unit, that means that analysts see 10.44% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of FVD's underlying holdings with notable upside to their analyst target prices are Diageo plc (Symbol: DEO), Toyota Motor Corporation (Symbol: TM), and Honda Motor Co Ltd (Symbol: HMC). Although DEO has traded at a recent price of $108.08/share, the average analyst target is 15.96% higher at $125.33/share. Similarly, TM has 14.34% upside from the recent share price of $182.88 if the average analyst target price of $209.10/share is reached, and analysts on average are expecting HMC to reach a target price of $33.60/share, which is 13.59% above the recent price of $29.58. Below is a twelve month price history chart comparing the stock performance of DEO, TM, and HMC:
Below is a summary table of the current analyst target prices discussed above:
Name
Symbol
Recent Price
Avg. Analyst 12-Mo. Target
% Upside to Target
First Trust Value Line Dividend Index Fund ETF
FVD
$44.36
$48.99
10.44%
Diageo plc
DEO
$108.08
$125.33
15.96%
Toyota Motor Corporation
TM
$182.88
$209.10
14.34%
Honda Motor Co Ltd
HMC
$29.58
$33.60
13.59%
Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock's trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.
10 ETFs With Most Upside To Analyst Targets »
Also see:
Materials Stocks Hedge Funds Are Buying
ARDS shares outstanding history
Funds Holding GSAX
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Implied FVD Analyst Target Price: $49

Diageo plc’s DEO recent stock performance reflects strong investor confidence in its fundamentals and strategic initiatives. The company’s shares have seen a 7.5% improvement in the past month, outpacing the industry’s 5.7% increase, the Consumer Staples sector’s 2.3% growth and the S&P 500’s 2.9% increase, suggesting resilience in a challenging market environment.
DEO Stock's Price Performance In the Past Month
Image Source: Zacks Investment Research
This upward momentum can be attributed to several key drivers, including the strength of its premium and globally recognized brand portfolio, featuring names such as Johnnie Walker, Guinness, and Tanqueray, which reinforces pricing power and customer loyalty.
Moreover, the company’s continued investments in innovation, digital transformation and e-commerce have improved both operational efficiency and consumer connectivity. Diageo’s disciplined approach to cost management and margin enhancement has also played a vital role in mitigating inflationary pressures, further supporting its recent stock gains.
DEO’s Growth Momentum
Diageo has been experiencing significant gains from improved price/mix, which have been aiding growth despite soft volume. In the first half of fiscal 2025, organic net sales rose 1% year over year, marking a return to organic sales growth and a sequential improvement from the second half of fiscal 2024. Hence, management expects to continue driving productivity and pricing to offset the cost inflation.
Diageo is refining its $2 billion productivity program to drive efficiency across the business to bring sustainable growth. A key focus is balancing cost savings with strategic reinvestment, particularly in marketing and brand activation. It remains committed to maximizing value while building the right capabilities for success.
By leveraging advanced data analytics through its Catalyst tool, Diageo aims to enhance the effectiveness of its A&P spend, prioritizing high-impact marketing while reducing non-working costs. The company is also optimizing media efficiencies, allowing it to reinvest savings into growth initiatives while strengthening operating leverage. A stronger focus on commercial excellence ensures better brand visibility at points of sale and expanded on-premise presence.
Near-Term Pressures Weigh on DEO Stock
Despite its recent gains, Diageo’s broader stock performance has faced pressure due to underlying operational challenges and macroeconomic headwinds. In the first half of fiscal 2025, the company reported a 0.6% year-over-year decline in net sales, primarily due to soft volume trends across key markets. Economic uncertainty, persistent inflationary pressures and cautious consumer sentiment led to volume declines in major regions.
Further weighing on investor sentiment are rising overhead costs, including staffing and strategic investments, which have compressed profitability. Currency fluctuations also significantly impacted operating profit, while organic operating profit declined and operating margins contracted, intensifying concerns over the company's earnings potential.
In Asia Pacific, performance weakened as well, with reported net sales down 4% year over year. This was attributed to a mix of organic sales decline, the divestiture of Windsor and a business reclassification to Europe. Organic net sales in the region fell 2.6%, affected by challenging macroeconomic conditions in Greater China, soft demand in Southeast Asia and tough year-over-year comparisons due to prior stock replenishment of Shui Jing Fang. Collectively, these factors have dampened investor confidence and weighed on Diageo’s stock performance despite its long-term strengths.
DEO’s Valuation Picture
Diageo’s premium valuation is becoming a concern amid slowing growth and rising costs. The stock is currently trading at a forward 12-month P/E ratio of 17.36X, significantly higher than the industry average of 16.30X.
This elevated multiple may be hard to justify given soft volume trends across key regions and macroeconomic uncertainties. This stretched valuation could limit upside potential in the near term, especially if performance fails to accelerate meaningfully.
Image Source: Zacks Investment Research
DEO’s Investment Strategy
Diageo’s robust brand portfolio, strategic investments and productivity initiatives position it well for recovery once macro conditions stabilize. However, until there is greater visibility on volume recovery and margin improvement, investors may prefer to wait for a better entry point or confirmation of sustained earnings momentum. For now, long-term investors should hold existing positions and monitor key indicators, particularly margin trends, FX impacts and progress on volume stabilization. Given these dynamics, DEO currently carries a Zacks Rank #3 (Hold).
Three Stocks Looking Good
Primo Brands Corporation PRMB is a branded beverage company with a focus on healthy hydration, delivering sustainably and domestically sourced diversified offerings across products, formats, channels, price points and consumer occasions, distributed primarily in every state and Canada. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Primo Brands’ current financial-year sales and EPS indicates growth of 146.9% and 57.4%, respectively, from the prior-year levels. PRMB has a trailing four-quarter earnings surprise of 7.2%, on average.
Molson Coors Beverage Company TAP, a global manufacturer and seller of beer and other beverage products, has an impressive, diverse portfolio of owned and partner brands. TAP currently flaunts a Zacks Rank of 1.
The Zacks Consensus Estimate for Molson Coors’ current financial-year EPS indicates growth of 6.7% from the prior-year levels. The company has a trailing four-quarter earnings surprise of 18.1%, on average.
United Natural Foods, Inc. UNFI distributes natural, organic, specialty, produce and conventional grocery and non-food products in the United States and Canada. It currently carries a Zacks Rank of 2 (Buy). UNFI delivered a trailing four-quarter earnings surprise of 408.7%, on average.
The consensus estimate for United Natural Foods’ current financial-year sales and earnings implies growth of 1.9% and 485.7%, respectively, from the year-ago figures.
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Molson Coors Beverage Company (TAP) : Free Stock Analysis Report
Diageo plc (DEO) : Free Stock Analysis Report
United Natural Foods, Inc. (UNFI) : Free Stock Analysis Report
Primo Brands Corporation (PRMB) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Diageo Stock Rises 7.5% in a Month: Buy or Wait for a Pullback?

Wednesday, May 7, 2025
The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Verizon Communications Inc. (VZ), Bristol-Myers Squibb Co. (BMY) and Canadian Pacific Kansas City Ltd. (CP), as well a micro-cap stock Nova LifeStyle, Inc. (NVFY). The Zacks microcap research is unique as our research content on these small and under-the-radar companies is the only research of its type in the country.
These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
You can see all of today’s research reports here >>>
Ahead of Wall Street
The daily 'Ahead of Wall Street' article is a must-read for all investors who would like to be ready for that day's trading action. The article comes out before the market opens and attempts to make sense of that morning's economic releases and how they will affect that day's market action. You can read this article for free on our home page and can actually sign up there to get an email notification as this article comes out each morning.
You can read today's AWS here >>> Pre-Markets in the Green: Disney Beats, Fed Report Awaits
Today's Featured Research Reports
Shares of Verizon Communications have gained +12.8% over the past six months against the Zacks Wireless National industry’s gain of +13.5%. The company recorded relatively healthy first-quarter 2025 results with both the top and bottom lines beating the Zacks Consensus Estimate.
With one of the most efficient wireless networks in the U.S., the company continues to deploy advanced technologies to deliver faster peak data speeds and capacity for customers, driven by customer-focused planning, disciplined engineering and constant strategic investment. Its focus on mix-and-match pricing across wireless and home broadband offerings has contributed to solid customer additions. The continued expansion of 5G mmWave in multiple markets is a positive development.
However, fierce competition from major players is hurting VZ’s profits. Heavy promotional spending and discounts to drive subscriber growth are putting pressure on margins. Macroeconomic challenges remain a concern.
(You can read the full research report on Verizon Communications here >>>)
Bristol-Myers Squibb shares have outperformed the Zacks Medical - Biomedical and Genetics industry over the past year (+14.3% vs. -17.6%). The company reported better-than-expected first quarter results driven by higher demand for Opdivo, Breyanzi, Reblozyl and Camzyos. Consequently, the annual guidance was raised to reflect this performance. Recent label expansions of blockbuster oncology drug Opdivo should fuel further growth.
However, generic competition for Revlimid, Pomalyst, Sprycel and Abraxane is adversely impacting revenue growth. While the performance of new drugs such as Opdualag, Camzyos and Cobenfy is encouraging, they will take some time to make a significant contribution to the top line.
Nonetheless, Bristol Myers’ efforts to streamline operations should boost the bottom line. Shares of the company are driven by the encouraging efforts to boost both top-line and bottom-line growth.
(You can read the full research report on Bristol-Myers Squibb here >>>)
Shares of Canadian Pacific have declined -9.4% over the past year against the Zacks Transportation - Rail industry’s decline of -12.6%. The company’s high operating expenses continue to weigh on the company's bottom line. CP's highly leveraged balance sheet is also a cause for worry. High capex may also create headwinds. Considering all these factors, investors are advised not to bet on the stock now. They should wait for a better entry point.
Nevertheless, following the approval of the merger with Kansas City Southern, the company is known as Canadian Pacific Kansas City Limited. The deal is anticipated to draw synergies (annually) of $1 billion within three years.
The merged entity has started to offer a daily premium intermodal service between the U.S. Midwest and Mexico. The Zacks analyst is impressed with Canadian Pacific Kansas City's efforts to reward its shareholders through dividends and share repurchases.
(You can read the full research report on Canadian Pacific here >>>)
Nova LifeStyle’s shares have underperformed the Zacks Furniture industry over the past year (-51.6% vs. -28.1%). This microcap company with market capitalization of $14 million is facing ongoing losses, revenue contraction, high administrative costs and execution risk in portfolio revamp challenge scalability and margin stability amid macro demand sensitivity.
Nevertheless, Nova LifeStyle’s 2024 gross margin rose to 44% from 38% as the firm exited low-margin products and boosted average selling price (ASP) by 43%, despite a 12.6% sales decline. Operating expenses fell 9.2%, lowering net loss to $5.6 million from $7.7 million, but general and administrative costs rose 19.8%, and research and development (R&D) cuts limited innovation gains.
A revamped product mix and North America focus (97.4% of sales) support pricing power, yet a 39% volume drop and Asian market exit signal weak demand. Sourcing diversification to Vietnam, India and Malaysia mitigates trade risk, though reliance on third-party vendors raises delivery and quality concerns.
(You can read the full research report on Nova LifeStyle here >>>)
Other noteworthy reports we are featuring today include Diageo plc (DEO), TC Energy Corp. (TRP) and Edwards Lifesciences Corp. (EW).
Mark Vickery
Senior Editor
Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>
Today's Must Read
Diverse Product Portfolio, Strategic Alliances Aid Verizon (VZ)
New Drugs Fuel Bristol Myers (BMY) Amid Generic Competition
Canadian Pacific (CP) Rides on Dividends Amid Rising Expenses
Featured Reports
Productivity Initiatives to Aid Diageo (DEO) Amid Inflation
Per the Zacks analyst, Diageo is refining its $2 billion productivity program to drive efficiency across the business while ensuring long-term sustainable growth and balancing cost savings.
TC Energy's (TRP) Vast Pipeline Network Fuels Future Growth
The Zacks analyst believes that TC Energy's robust pipeline infrastructure and gas storage assets offer a solid foundation for future growth, but its debt of over C$45 billion remains a concern.
Edwards (EW) Rides on Solid TMTT Sales and Global Prospects
Edwards' strong TMTT sales globally is a major positive. Per the Zacks analyst, differentiated therapies, positive pivotal trial results and favorable real-world clinical outcomes are the key drivers.
Strong Demand, Expansion Actions Aid Nucor (NUE)
While Nucor faces headwinds from weak selling prices, it will benefit from strong demand in its major markets and efforts to boost production capacity, per the Zacks analyst.
Healthy Demand Aid Equity Residential (EQR) Amid High Supply
Per the Zacks Analyst, healthy demand to sustain the occupancy level and support revenue growth for Equity Residential. However, elevated supply in some markets and high interest expenses ail.
Defense Orders Drive Leidos (LDOS), Amid Labor Shortage
Per the Zacks analyst, Leidos Holdings is likely to benefit from increasing defense order growth from the Pentagon and US allies. Yet labor shortage result in delays and likely impact operating result
Strategic Buyouts to Aid Genuine Parts (GPC) Amid Tariff Woes
Acquisitions of MPEC and Walker has strengthened Genuine Parts' NAPA store network and Midwest footprint. However, cost pressures due to tariffs may limit the firm's profits, per the Zacks analyst.
New Upgrades
Juniper (JNPR) Rides on Healthy Demand Trends, AI Focus
Per the Zacks analyst, solid momentum in the Cloud and Enterprise verticals will likely drive Juniper's top line. A strong focus on advancing the AI networking portfolio is a tailwind.
Encompass Health (EHC) Gains From Expansionary Measures
The Zacks Analyst believes that Encompass Health's expansion through de novo hospitals will drive patient volumes and profit levels.
Paylocity (PCTY) Rides on Strong Demand for Cloud Solutions
Per the Zacks analyst, Paylocity is benefiting from strong adoption of its cloud-based Human Capital Management (HCM) and payroll software solutions tailored for mid-sized businesses.
New Downgrades
Rising Expenses & Oil Price Volatility Ail SM Energy (SM)
Per the Zacks analyst, SM Energy's profits suffer due to falling oil prices and rising lease operating and transportation costs, threatening future revenue and cash???flow stability.
PC Market Weakness Hurts Dell Technologies (DELL) Prospects
Per the Zacks analyst, Dell is suffering from a challenging macroeconomic environment. It suffers from stiff competition in the PC market from the likes of HP and Lenovo.
Soft OSB Segment & Macro Woes Hurt Louisiana-Pacific (LPX)
Per the Zacks analyst, Louisiana-Pacific is hurting from to lower selling prices and decreased sales volumes in the OSB segment. Also, rising costs from expected tariffs are added concerns.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
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Bristol Myers Squibb Company (BMY) : Free Stock Analysis Report
Verizon Communications Inc. (VZ) : Free Stock Analysis Report
Diageo plc (DEO) : Free Stock Analysis Report
Canadian Pacific Kansas City Limited (CP) : Free Stock Analysis Report
TC Energy Corporation (TRP) : Free Stock Analysis Report
Nova Lifestyle, Inc (NVFY): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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