Value has been building behind the Diageo share price

The current level of Diageo (LSE: DGE) share price near 3,600p makes the stock look attractive, I feel.

Fast-moving consumer goods business specializing in branded beverages. And the price always seems to be quite complete.

But the situation is improving: the share price has been consolidating for about a year and a half. And it first reached its current level more than 19 months ago.

Value has been built

Meanwhile, business has been booming. And the value has been building up. Indeed, revenue, earnings and shareholder dividends have all risen higher over the past two years. And City analysts expect further gains going forward.

But over the past 12 months, the share price has fallen about 8%.

It seems like the company has been caught up in the general malaise that has affected the stock market recently. But the situation may create an opportunity for investors to consider research for the long term.

Earnings look set to rise by around 8% in the trading year to June 2024. And the anticipated dividend yield for the year is just under 2.4%.

It’s not a huge return, but the business has a good track record of increasing shareholder payouts a little each year. And dividend growth has continued through the pandemic, underscoring the resilience of the business.

Change ahead

But things are changing. The new chief executive, Debra Crew, will start on July 1 following her promotion from the position of chief operating officer. And this is after the retirement of the current chief, Sir Ivan Menezes, who has been in the post for a decade or more.

The above changes are often able to reinvigorate the business when the new owner comes with new ideas and a new determination to succeed. Therefore, I see the move as positive for shareholders.

That said, the stock price has risen just over 80% according to the outgoing leader. And there is a growing dividend stream for shareholders on top of that capital gain.

Meanwhile, Crew said on March 28 that it is independent “an incredible privilege“To have the opportunity to lead Diageo through the next phase of development. And there will be a focus on continuing our efforts to build a world-leading brand “the most exciting consumer product category.”

Meanwhile, the brand has the potential to support investment in the stock. I’m talking about well-known company names such as Johnny Walker, Guinness, Tanqueray, Baileys, Smirnoff and many more.

However, even quality businesses can suffer from operational setbacks. And even if the price is lower than before, it is possible that the stock price could go lower or stay close to that place for a long time.

Indeed, all stocks carry risks as well as positive potential. However, my feeling is that now is a good time to do some business research. And stocks have the potential to make a worthwhile contribution to a diversified long-term portfolio.