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Is Omnicom (OMC) Stock Undervalued Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Omnicom (OMC - Free Report) . OMC is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

We should also highlight that OMC has a P/B ratio of 6.03. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 13.51. Within the past 52 weeks, OMC's P/B has been as high as 6.28 and as low as 5.16, with a median of 5.52.

Finally, our model also underscores that OMC has a P/CF ratio of 11.66. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. OMC's P/CF compares to its industry's average P/CF of 13.42. Over the past year, OMC's P/CF has been as high as 12.15 and as low as 10.24, with a median of 11.22.

These are only a few of the key metrics included in Omnicom's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, OMC looks like an impressive value stock at the moment.


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