The last few years have been an absolute horror show for holders of Diageo (LSE: DGE) shares. However, anyone brave enough to snap up the stock one month ago might be feeling a little smug.

The premium spirit giant’s value has increased by just under 10% over this period. OK, so that sort of gain probably won’t see many champagne corks being popped. But it’s almost double the rise seen in the FTSE 100 index over the same period.

Put another way, a £10,000 stake will have already generated a tidy profit of around £1,000.

I don’t know about you, but that seems a pretty great return for doing little more than clicking the ‘buy’ button.

So, can Diageo shares keep rising?

As always, one can come up with reasons that support and oppose the idea that this form will continue.

Optimists will point to this month’s trading statement as evidence that former Tesco man and new CEO Dave Lewis is already having a positive impact.

Reported net sales were 2.3% higher in the firm’s third quarter. Guidance for the whole 2026 financial year was also reiterated. Sure, that’s hardly the sort of news to get the pulse racing. But it does suggest that things are starting to stabilise.

The number of short sellers circling the stock is relatively low, too. If these usually-very-well-informed traders aren’t confident enough to bet the share price will fall from here, that’s got to be encouraging, right?

No shortage of challenges

Well, it’s worth bearing in mind that even the most hated stocks can still see periods where the share price heads north, despite nothing massively changing. Sentiment about individual companies can often overshoot in either direction, thanks to short-term buyers and sellers (not Magpies) being driven by emotion. Perhaps Diageo’s recent rise is simply an indication that people are still pessimistic, just slightly less pessimistic than before?

There are certainly plenty of reasons for staying grounded. Indeed, the company said that it “remains mindful of continued geopolitical uncertainty“. North America — where market conditions were described as “soft” also remains its “biggest challenge” and things won’t be fixed overnight.

Now factor in the not-unsubstantial, longer-term challenges of weight-loss drugs and health-obsessed younger generations drinking less alcohol.

Let’s also not forget that stock markets can be cruel. Lewis and his team could do everything right from here and still see the company’s value dragged down along with everything else due to a macroeconomic shock.

Promising movement

As things stand, I see the recent positive momentum as something to toast. But I’m not quite ready to believe that we’ve seen an end to Diageo’s dark days just yet. With no more numbers expected until August’s full-year results, investors may look to move their money elsewhere. Sometimes, no news is as bad as, well, bad news.

Still, I’m definitely not looking to take the shares off my wishlist. Some seriously hot weather and major sporting events, such as the forthcoming World Cup, surely won’t do any harm to sales.

If the company can then show it has managed to deliver on its target of £300m in savings by the end of June (or possibly even more), I can see buyers piling in.

Should you invest £5,000 in Diageo Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Diageo Plc made the list?

Paul Summers does not hold any positions in the companies mentioned.