Share prices of alcohol brands largely underperforming in the market

Diageo, Pernod Ricard, and Heineken were among the weakest performers

Report comes as Diageo increases prices again. 

Share prices in some of the biggest alcohol producers in the world, including Diageo and Pernod Ricard, have significantly underperformed in the market as consumer preferences shift, a new analysis has found.

The analysis, conducted by online trading firm IG Group, shows over the last five years shares in Pernod Ricard were down 46% while shares in Diageo were down 38%.

These two companies produce a number of well-known Irish brands. Diageo produces Guinness, Smithwick’s and Harp, while Pernod Ricard produces Jameson, Powers, and Redbreast whiskeys.

As part of the analysis, IG Group analysed the performance of eight leading alcoholic beverage companies, which showed an average negative return for investors over one, three and five years.

The eight companies included Diageo, AB Inbev, Heineken, Pernod Ricard, Ambev, Constellation Brands, Carlsberg, and Asahi.

It found this basket of companies produced a negative return for investors over one year, down 0.3%, over three years, down 10.9%, and over five years, down 5.1%.

In comparison, the US-focused S&P returned investors 96.5% over five years largely driven by the Magnificent Seven companies and an AI-related surge in valuations. 

In that same time, the UK’s FTSE 100 returned 76.2%, while the pan-European STOXX 600 returned 73.2%.

“The findings are particularly relevant in Ireland, where global drinks groups occupy an outsized position in both consumer culture and investor portfolios,” IG said.

“Based on IG’s own Irish customer data, the number of Irish retail investors holding Diageo shares rose by more than 275% in 2025.” 

Alcohol consumption on decline

Chief market analyst at IG Chris Beauchamp said “alcohol consumption is on the decline across global markets, and the varied headwinds facing the drinks sector likely mean Dry January is the least of concerns for corporates”.

“Destocking, rising production costs, weak margins, and interest rate exposure are putting additional pressure on an already stretched sector. Pernod Ricard and, to a lesser extent, Diageo and Heineken have also been hurt by stop-start Chinese demand and weak consumer confidence. Investors are clearly paying attention.” 

He pointed out Diageo, Pernod Ricard, and Heineken — which also produces Beamish and Murphy’s — were among the weakest performers among the eight companies analysed.

IG noted there had been a behaviour shift among consumers, citing a Drinks Industry Group of Ireland report from 2025 which found the average per capita alcohol consumption per adult had declined by over one-third since 2001.

It said this shift mattered for alcohol producers.

“The strong sales for some low and zero alcohol alternatives, such as Guinness 0.0, may offer a glimpse for producers as to how product innovation could improve market performance in the face of changing consumer habits,” Mr Beauchamp added.

On top of the changing consumer behaviour, these companies are also facing headwinds such as cost inflation, and the destocking of US beer and spirit distribution.

This report comes after Diageo announced plans to increase prices again, adding 7c to draught products with punters set to face a 20c price increase.

Diageo said higher costs were behind the price increase, with the company facing increases including wage inflation, rising energy costs in Ireland, and increased logistical and regulatory requirements. The price increases are effective from February 2.