Diageo (LSE:DGE) Investors face little respite as FTSE 100 index The company's stock price continues to decline. At 17.40 per share, it fell again on Thursday (November 6) after cutting full-year sales and earnings forecasts.

Diageo shares are now down 25% over the past 12 months. Over the course of three years, its value halved, shredding the company's reputation as a safe defensive play.

As an investor, I think about how bad things could get Smirnov and Guinness Manufacturer. However, at the same time, I'm also considering whether its declining share prices represent a buy-in opportunity for a long-term investor like me.

More bad news

In a market update on Thursday, Diageo reported a 2.2% decline in reported net sales. On an organic basis, revenues remained flat, as support from higher volumes was eliminated by a worse price mix.

The company said this was largely due to weakness in the Chinese white spirits (CWS) category. It also suffered from difficult consumer conditions and competitive pressures in the American spirits market.

It wasn't all bad, with organic net sales increasing in Europe, Africa and the Latin America and Caribbean (LAC) region. But declines in Asia Pacific and North America mean the company now expects full-year net organic sales.To be slightly flattened downCompared to its previous forecast, revenue was unchanged.

Organic operating profits also tend to grow by low to mid-single digit percentages. A higher average percentage was expected.

Questions

This latest update once again raises questions about Diageo's ability to respond to changing consumer tastes. In times past, shoppers would fill their carts with the company's popular premium brands in good times and bad.

Other concerns include whether she likes weight loss medications Ozimbek It has a long-term seismic effect on the demand for alcohol. In times like these, investors look to strong and stable management for reassurance.

That's not the case at Diageo – where CFO Nick Gangiani remains in an interim role following the departure of CEO Debra Crowe in July. Ganjiani had said that a permanent successor would likely be announced by the end of last month.

This is what I do

These are undoubtedly difficult times for Diageo. But it did not become a basket case. Sales outside North America and Asia provide cause for encouragement, as does the company's move into fast-growing categories such as non-alcoholic beverages.

Moreover, Accelerate's simplification program helps the company overcome the current difficult circumstances. Diageo saysCost savings guidance of $625 million over the next three years [are] Completely on the right track“.

Today, Diageo shares trade at a price-to-earnings (P/E) ratio of 13.6 times. This is well below the 10-year average of 21 times, and in other circumstances represents an interesting buy-down opportunity which I would consider.

For now, I'm happy to sit on the sidelines since I already own shares in the company. I'm confident that Diageo's share price will rebound strongly over time. The “brands worth around twelve billion dollars” in its portfolio make it well placed to benefit from the market recovery and the wealth boom in emerging markets.

But until the outlook becomes clearer and the leadership gaps are filled, I don't plan to increase my stake in the FTSE company.