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Interpublic (IPG) Stock Up 13.6% Year to Date: Here's Why
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Shares of The Interpublic Group of Companies, Inc. (IPG - Free Report) have gained 13.6% on a year-to-date basis against 19.4% decline of the industry it belongs to and 1.6% decline of the Zacks S&P 500 composite.
Catalysts Behind the Upside
Solid Business Model
Interpublic’s digital capabilities, diversified business model and geographic reach offer a distinctive competitive advantage. The company is expected to achieve targeted levels in the coming quarters, based on diversification across emerging regions and collaboration/integration across agencies through technological improvement. It continues to look for investments/acquisitions to expand in high-growth regions and key global markets.
Robust Organic Growth
Interpublic continues to benefit from organic revenue growth. In the first nine months of 2018, organic revenue growth was 4.9%, which was primarily a result of net client wins and higher spending from existing clients, especially in the healthcare and financial services sectors. Geographically, organic growth was 4.6% in the United States and 5.4% in international markets. Further, Interpublic reaffirmed its full year 2018 target for organic net revenue growth. The company expects organic revenue growth of 4% to 4.5% for 2018.
Acquisitions: A Key Growth Catalyst
Interpublic has been continuously acquiring and investing in companies globally to expand its product portfolio, thereby trying to adapt to rapidly changing marketing services and the media market. So far this year, the company has completed three acquisitions. These include the buyout of data-related and analytical services provider, Acxiom LLC in October; London-based social creative agency That Lot through its subsidiary, Weber Shandwick in July; and Brazil-based digital marketing and technology agency, Cappuccino in May.
In the recent years, Interpublic has acquired agencies across the marketing spectrum, which includes firms specializing in digital, mobile marketing, social media, healthcare communications and public relations, as well as agencies with full-service capabilities.
A few other top-ranked stocks in the broader Zacks Business Services sector are Accenture plc (ACN - Free Report) , Automatic Data Processing Inc. (ADP - Free Report) and Navigant Consulting, Inc. , each carrying a Zacks Rank #2. Long-term expected EPS (three to five years) growth rate for Accenture, Automatic Data Processing and Navigant is 10.3%, 12.5% and 13.5% respectively.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Interpublic (IPG) Stock Up 13.6% Year to Date: Here's Why
Shares of The Interpublic Group of Companies, Inc. (IPG - Free Report) have gained 13.6% on a year-to-date basis against 19.4% decline of the industry it belongs to and 1.6% decline of the Zacks S&P 500 composite.
Catalysts Behind the Upside
Solid Business Model
Interpublic’s digital capabilities, diversified business model and geographic reach offer a distinctive competitive advantage. The company is expected to achieve targeted levels in the coming quarters, based on diversification across emerging regions and collaboration/integration across agencies through technological improvement. It continues to look for investments/acquisitions to expand in high-growth regions and key global markets.
Robust Organic Growth
Interpublic continues to benefit from organic revenue growth. In the first nine months of 2018, organic revenue growth was 4.9%, which was primarily a result of net client wins and higher spending from existing clients, especially in the healthcare and financial services sectors. Geographically, organic growth was 4.6% in the United States and 5.4% in international markets. Further, Interpublic reaffirmed its full year 2018 target for organic net revenue growth. The company expects organic revenue growth of 4% to 4.5% for 2018.
Acquisitions: A Key Growth Catalyst
Interpublic has been continuously acquiring and investing in companies globally to expand its product portfolio, thereby trying to adapt to rapidly changing marketing services and the media market. So far this year, the company has completed three acquisitions. These include the buyout of data-related and analytical services provider, Acxiom LLC in October; London-based social creative agency That Lot through its subsidiary, Weber Shandwick in July; and Brazil-based digital marketing and technology agency, Cappuccino in May.
In the recent years, Interpublic has acquired agencies across the marketing spectrum, which includes firms specializing in digital, mobile marketing, social media, healthcare communications and public relations, as well as agencies with full-service capabilities.
Zacks Rank & Stocks to Consider
Currently, Interpublic is a Zacks Rank #2 (Buy) stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A few other top-ranked stocks in the broader Zacks Business Services sector are Accenture plc (ACN - Free Report) , Automatic Data Processing Inc. (ADP - Free Report) and Navigant Consulting, Inc. , each carrying a Zacks Rank #2. Long-term expected EPS (three to five years) growth rate for Accenture, Automatic Data Processing and Navigant is 10.3%, 12.5% and 13.5% respectively.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>