Valued at a market cap of $14.8 billion, Omnicom Group Inc. (OMC) is an advertising, marketing and corporate communications company that provides a range of services in the areas of media and advertising, precision marketing, public relations, healthcare, branding, experiential, execution, and support. This New York-based company is scheduled to announce its fiscal Q1 earnings for 2025 on Tuesday, Apr. 15.
Ahead of this event, analysts expect this advertising company to report a profit of $1.60 per share, down 4.2% from $1.67 per share in the year-ago quarter. The company has a promising trajectory of consistently beating Wall Street's earnings estimates in each of the last four quarters. In Q4 2024, OMC’s EPS of $2.41 topped the forecasted figure by 3.9%.
For fiscal 2025, analysts expect Omnicom to report a profit of $8.22 per share, up 2% from $8.06 in fiscal 2024. Furthermore, its EPS is expected to grow 8.3% year over year to $8.90 in fiscal 2026.
Shares of OMC have fallen 20.5% over the past 52 weeks, considerably underperforming both the S&P 500 Index's ($SPX) 3.6% return, and the Communication Services Select Sector SPDR ETF’s (XLC) 11.7% rise over the same time frame.
Shares of OMC fell 2.3% the day following its Q4 earnings release on Feb. 4. The company posted adjusted earnings of $2.41 per share, which advanced 6.6% year-over-year and exceeded the consensus estimate of $2.32. Moreover, its revenue grew 6.4% from the year-ago quarter to $4.3 billion, supported by a 5.2% rise in organic sales. Its adjusted EBITDA rose 6.6% annually to $722.2 million, further underscoring its profitability growth.
However, investor sentiment might have been impacted by a 6.5% rise in operating expenses, fueled by higher service costs. A decline in organic revenue within the healthcare and branding & retail commerce segments coupled with the management's expectation of a slowdown in organic growth for 2025, with estimates set between 3.5% and 4.5%, might have further weighed on investor confidence
Wall Street analysts are moderately optimistic about OMC’s stock, with a "Moderate Buy" rating overall. Among 10 analysts covering the stock, five recommend "Strong Buy," four suggest “Hold,” and one advises a “Moderate Sell” rating. The mean price target for OMC is $105.62 which indicates a notable 40.1% potential upside from the current levels.
