UBS reaffirms its 'sell' recommendation on Diageo and reduces its price target from 2650 to 2600 pence, a new target implying a 9% downside potential for the stock, the day after the publication of the British spirits group's results.

Although Diageo has cautiously lowered its expectations, we believe that the valuation premium over its peers is vulnerable to prolonged weakness in the sector and in US equities", the broker believes in the summary of its note.

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