New York-based The Interpublic Group of Companies, Inc. (IPG) provides advertising and marketing services. Valued at $11.8 billion by market cap, IPG is a global provider of marketing solutions that operate in advertising, independent media buying, direct marketing, healthcare communications, interactive consulting services, marketing research, promotions, experiential and sport marketing, and public relations sectors.
Shares of this global advertising holding company have underperformed the broader market considerably over the past year. IPG has declined 3.4% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 28.1%. In 2024, IPG stock is down 4.3%, while SPX is up 17.3% on a YTD basis.
Narrowing the focus, IPG has also lagged behind the Vanguard Communication Services Index Fund ETF Shares (VOX). The exchange-traded fund has gained about 31.9% over the past year. Moreover, the ETF’s 18.2% gains on a YTD basis outshine the stock’s single-digit losses over the same time frame.
On Jul. 24, IPG shares closed down more than 1% after reporting its Q2 earnings results. Its adjusted EPS declined 17.6% year over year to $0.61. The company’s total revenues stood at $2.7 billion, up 1.6% year over year. For fiscal 2024, the company expects organic net revenues to grow 1% year over year. The adjusted EBITA margin is anticipated to be 16.6%.
For the current fiscal year, ending in December, analysts expect IPG’s EPS to decline 5.7% to $2.82 on a diluted basis. The company’s earnings surprise history is mixed. It beat or matched the consensus estimate in three of the last four quarters while missing the forecast on another occasion. Additionally, it met the consensus earnings estimate of $0.61 in the recent quarter.
Among the nine analysts covering IPG stock, the consensus is a “Moderate Buy.” That’s based on three “Strong Buy” ratings, five “Holds,” and one “Strong Sell.”
On Jul. 25, Barclays PLC (BCS) analyst Julien Roch maintained a “Hold” rating on IPG with a price target of $34, implying a potential upside of 8.8% from current levels.
The mean price target of $33 represents a 5.6% premium to IPG’s current price levels. The Street-high price target of $37 suggests an upside potential of 18.4%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
