With a market cap of $16.1 billion, Omnicom Group Inc. (OMC) is a leading global advertising, marketing, and corporate communications company with a presence across major international markets. It offers a wide range of services, including media and advertising, public relations, digital marketing, branding, and data analytics, competing with top firms in a highly competitive industry.
Shares of the New York-based company have underperformed the broader market over the past 52 weeks. OMC has declined 4.6% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 22.5%. Moreover, shares of OMC are down nearly 3% on a YTD basis, compared to SPX’s 4.2% gain.
Focusing more closely, the advertising company has also lagged behind the Communication Services Select Sector SPDR ETF Fund’s (XLC) 32.8% return over the past 52 weeks and an 8.3% YTD gain.
Omnicom Group reported a strong Q4 2024 earnings report on Feb. 4, which exceeded Wall Street expectations, with EPS of $2.41 beating the consensus estimate and revenue growing 6.4% year-over-year to $4.3 billion. The company's advertising and media segment, its largest revenue driver, posted a 5.9% increase, benefiting from higher political and retail ad spending driven by the U.S. presidential election and holiday season. Additionally, investor confidence was boosted by Omnicom’s $13.3 billion acquisition of Interpublic Group, which is expected to enhance market dominance and drive future growth. But, the stock fell 2.3% the next day.
For the current fiscal year, ending in December 2025, analysts expect OMC’s EPS to grow 2.4% year-over-year to $8.25. The company's earnings surprise history is promising. It beat the consensus estimates in the last four quarters.
Among the nine analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on five “Strong Buy” ratings, three “Holds,” and one “Moderate Sell.”
This configuration is slightly less bullish than three months ago, with six “Strong Buy” ratings on the stock.
On Jan. 24, Barclays analyst Julien Roch maintained a Buy rating on Omnicom Group, setting a price target of $110.
As of writing, OMC is trading below the mean price target of $108.25. The Street-high price target of $120 implies a potential upside of 43.7% from the current price levels.
