In 2007, Diageo debuted its publicly traded ADR with the ticker symbol DEO for investors in the United States. An ADR means a sponsoring bank–in the case of Diageo, it is the Bank of New York Mellon–goes over on the London Stock Exchange and purchases a giant block of Diageo stock that is then packaged and sold to American investors. An ADR means the shares are created through a bank buying the shares on a foreign exchange and then supervising the trading; an ADS means that the corporation itself acts as an issuer of shares on a trading exchange outside of the country where the business is domiciled.
When the Bank of New York Mellon made Diageo shares easily available to American investors, the stock traded at $74.50 per share. At the time, the alcohol corporation was making $4.02 per share in profits and paying $2.63 of those profits to … Read the rest of this article!