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The Interpublic Group of Companies, Inc. (IPG - Free Report) reported better-than-expected second-quarter 2020 results.
Adjusted earnings of 23 cents per share beat the Zacks Consensus Estimate by 15% but declined 50% on a year-over-year basis.
Net revenues of $1.85 billion beat the consensus estimate by 6.3% but decreased on a year-over-year basis due to organic net revenue decrease of 9.9%, negative impact of 2.1% due to foreign currency movement and 0.8% due to dispositions. Total revenues of $2.03 billion declined 19.6% year over year.
Interpublic Group of Companies, Inc. The Revenue (TTM)
So far this year, shares of Interpublic have lost 20.3% compared with 37% decline of the industry it belongs to and 0.8% increase of the Zacks S&P 500 composite.
Let’s check out the numbers in detail.
Operating Results
Operating income in second-quarter 2020 came in at $40.5 million compared with $264.2 million in the prior-year quarter. Operating margin on net revenues decreased to 2.2% from 12.4% in the year-ago quarter. Operating margin on total revenues fell to 1.9% from 10.5% in the year-ago quarter.
Adjusted EBITA came in at $62.3 million, compared with $285.5 million at the end of the prior-year quarter. Adjusted EBITA margin on net revenues declined to 3.4% from 13.4% in the year-ago quarter. Adjusted EBITA margin on total revenues fell to 3.1% from 11.3% in the year-ago quarter.
Total operating expenses of $2.28 billion declined 1.2% year over year.
Interpublic Group of Companies, Inc. The Price, Consensus and EPS Surprise
As of Jun 30, 2020, Interpublic had cash and cash equivalents of $1.09 billion, compared with $1.55 billion at the end of the prior quarter. Total debt was $3.97 billion compared with $4.22 billion at the end of the prior quarter.
Dividend Payout
During the reported quarter, the company declared and paid out a cash dividend of 25.5 cents per share, amounting to $99.2 million.
Equifax (EFX - Free Report) reported better-than-expected second-quarter 2020 adjusted earnings of $1.60 per share, whichbeat the Zacks Consensus Estimate by 22.1% and improved 14.3% on a year-over-year basis. The reported figure exceeded the guided range of 78-88 cents.
IQVIA Holdings (IQV - Free Report) reported second-quarter 2020 adjusted earnings per share of $1.18, which beat the consensus mark by 12.4% but decreased 22.9% on a year-over-year basis. The reported figure exceeded the guided range of $1.00-$1.09.
Robert Half (RHI - Free Report) reported second-quarter 2020 earnings of 41 cents per share, which beat the consensus mark by 17% but were down 58% year over year.
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Interpublic (IPG) Surpasses Q2 Earnings & Revenue Estimates
The Interpublic Group of Companies, Inc. (IPG - Free Report) reported better-than-expected second-quarter 2020 results.
Adjusted earnings of 23 cents per share beat the Zacks Consensus Estimate by 15% but declined 50% on a year-over-year basis.
Net revenues of $1.85 billion beat the consensus estimate by 6.3% but decreased on a year-over-year basis due to organic net revenue decrease of 9.9%, negative impact of 2.1% due to foreign currency movement and 0.8% due to dispositions. Total revenues of $2.03 billion declined 19.6% year over year.
Interpublic Group of Companies, Inc. The Revenue (TTM)
Interpublic Group of Companies, Inc. The revenue-ttm | Interpublic Group of Companies, Inc. The Quote
So far this year, shares of Interpublic have lost 20.3% compared with 37% decline of the industry it belongs to and 0.8% increase of the Zacks S&P 500 composite.
Let’s check out the numbers in detail.
Operating Results
Operating income in second-quarter 2020 came in at $40.5 million compared with $264.2 million in the prior-year quarter. Operating margin on net revenues decreased to 2.2% from 12.4% in the year-ago quarter. Operating margin on total revenues fell to 1.9% from 10.5% in the year-ago quarter.
Adjusted EBITA came in at $62.3 million, compared with $285.5 million at the end of the prior-year quarter. Adjusted EBITA margin on net revenues declined to 3.4% from 13.4% in the year-ago quarter. Adjusted EBITA margin on total revenues fell to 3.1% from 11.3% in the year-ago quarter.
Total operating expenses of $2.28 billion declined 1.2% year over year.
Interpublic Group of Companies, Inc. The Price, Consensus and EPS Surprise
Interpublic Group of Companies, Inc. The price-consensus-eps-surprise-chart | Interpublic Group of Companies, Inc. The Quote
Balance Sheet
As of Jun 30, 2020, Interpublic had cash and cash equivalents of $1.09 billion, compared with $1.55 billion at the end of the prior quarter. Total debt was $3.97 billion compared with $4.22 billion at the end of the prior quarter.
Dividend Payout
During the reported quarter, the company declared and paid out a cash dividend of 25.5 cents per share, amounting to $99.2 million.
Currently, Interpublic carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Business Services Companies
Equifax (EFX - Free Report) reported better-than-expected second-quarter 2020 adjusted earnings of $1.60 per share, whichbeat the Zacks Consensus Estimate by 22.1% and improved 14.3% on a year-over-year basis. The reported figure exceeded the guided range of 78-88 cents.
IQVIA Holdings (IQV - Free Report) reported second-quarter 2020 adjusted earnings per share of $1.18, which beat the consensus mark by 12.4% but decreased 22.9% on a year-over-year basis. The reported figure exceeded the guided range of $1.00-$1.09.
Robert Half (RHI - Free Report) reported second-quarter 2020 earnings of 41 cents per share, which beat the consensus mark by 17% but were down 58% year over year.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained an impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
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