Omnicom Q2 revenue, adjusted EPS beats estimates

Overview

• Omnicom Q2 revenue rises 4.2% to $4.0 bln, beating expectations, per LSEG data

• Adjusted EPS for Q2 beats estimates at $2.05, per LSEG data

• Operating profit missed expectations, affected by acquisition and repositioning costs

Outlook

• Omnicom sees significant growth opportunities from Interpublic acquisition.

• Company acknowledges macroeconomic and geopolitical uncertainties impacting business.

• Omnicom cleared U.S. antitrust review for Interpublic acquisition.

Result Drivers

• ORGANIC GROWTH - Omnicom achieved 3.0% organic revenue growth, driven by Media & Advertising and Precision Marketing, despite declines in Public Relations and Healthcare

• ACQUISITION COSTS - Operating profit impacted by $66 million in acquisition costs related to Interpublic merger

• REPOSITIONING EXPENSES - $88.8 million in repositioning costs, primarily for severance, affected operating income

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 7 "strong buy" or "buy", 5 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the advertising & marketing peer group is "buy"

• Wall Street's median 12-month price target for Omnicom Group Inc is $99.00, about 26.6% above its July 14 closing price of $72.65

• The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 10 three months ago

Press Release: ID:nPn6S9M8Ca