Brown-Forman Corp (BF-A) is slightly undervalued and Diageo plc ADR (DEO) is fairly valued.
Against our estimates of intrinsic value, BF-A trades at the wider discount: a margin of safety of +8%, against +0% for DEO.
Values as of the 22 Sept 2026 close.
Discounting its cash flows at 7.2% (average of 3 methods) values the shares at $29.13; the price of $26.94 is 8% below that value, and 82% of that value comes from beyond year five.
Leak Score 59/100 on 3 of 12 signals
Discounting its cash flows at 7.4% (average of 3 methods) values the shares at $87.43; the price of $87.37 sits right on that value, and 81% of that value comes from beyond year five.
Leak Score 14/100 on 3 of 12 signals
| Metric | BF-A | DEO |
|---|---|---|
| Verdict | Slightly undervalued | Fairly valued |
| Price | $26.94 | $87.37 |
| Intrinsic value | $29.13 | $87.43 |
| Margin of safety | +8% | +0% |
| Leak Score | 59/100 (3/12) | 14/100 (3/12) |
| Market cap | $12.2B | $48.6B |
| Revenue growth, 5 years | 2.7% | 2.7% |
| Operating margin | 28.5% | 28.9% |
| Net margin | 18.3% | 8.8% |
| Return on equity | 18.1% | 15.8% |
| Debt to equity | 0.62 | 2.04 |
| P/E | 17.4x | 28.2x |
| Forward P/E | 15.7x | 12.3x |
| P/B | 3.1x | 4.5x |
| Dividend yield | 3.5% | 2.5% |