Diageo plc ADR (DEO) is fairly valued and MGP Ingredients Inc (MGPI) is undervalued.
Against our estimates of intrinsic value, MGPI trades at the wider discount: a margin of safety of +46%, against +0% for DEO.
Values as of the 22 Sept 2026 close.
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
Its through-the-cycle earnings (13.5% median margin), capitalised at 6.7% with no growth, values the shares at $25.05; the price of $13.50 is 46% below that value.
Leak Score 50/100 on 8 of 12 signals
| Metric | DEO | MGPI |
|---|---|---|
| Verdict | Fairly valued | Undervalued |
| Price | $87.37 | $13.50 |
| Intrinsic value | $87.43 | $25.05 |
| Margin of safety | +0% | +46% |
| Leak Score | 14/100 (3/12) | 50/100 (8/12) |
| Market cap | $48.6B | $289M |
| Revenue growth, 5 years | 2.7% | 6.3% |
| Operating margin | 28.9% | 13.2% |
| Net margin | 8.8% | -48.1% |
| Return on equity | 15.8% | -33.6% |
| Debt to equity | 2.04 | 0.64 |
| P/E | 28.2x | — |
| Forward P/E | 12.3x | 6.9x |
| P/B | 4.5x | 0.5x |
| Dividend yield | 2.5% | 3.6% |