Omnicom Group Inc. (OMC - Free Report) reported impressive first-quarter 2024 results, wherein both earnings and revenues beat the Zacks Consensus Estimate.
Earnings of $1.67 per share beat the consensus estimate by 9.9% and increased 7.1% year over year. Total revenues of $3.6 billion surpassed the consensus estimate by 1.6% and increased 5.4% year over year.
The increase in the top line was led by an increase of 4% in revenues from organic growth and a 1.5% increase in acquisition revenues, net of disposition revenues, mainly due to the Flywheel Digital acquisition in the Precision Marketing segment.
Omnicom shares have gained 22.3% over the past six months compared with 10.4% rise of the industry it belongs to and the 16.9% rally of the Zacks S&P 500 composite.
Organic Growth Across Disciplines and Regions
Across fundamental disciplines, revenues from Advertising & Media increased 7% compared with our estimated growth of 6.4%. Precision marketing revenues jumped 4.3% compared with our estimate of 3.1% growth. Experiential revenues improved 9.5% compared with our expectation of 4.7% growth.
Public Relations revenues decreased 1.1% compared with our estimation of a 0.6% decline. Healthcare revenues increased 2.1% organically, year over year, versus our estimated growth of 3.8%. Branding & Retail Commerce revenues were down 3.8% versus our estimated growth of 1.3%. Execution and support declined 4.3% versus our estimated decline of 1.1%.
Across regional markets, year-over-year organic revenue growth was 4.3% in the United States, 3.2% in the U.K., 3.5% in Euro Markets & Other Europe, 22.3% in Latin America, 3% in Asia Pacific and 1.1% in Other North America. Middle East & Africa revenues declined 4.2%.
Margin Performance
EBITA in the quarter came in at $500.4 million, up 38.5% year over year. EBITA margin was 13.8%, up 330 basis points (bps) year over year. Operating profit of $478.9 million increased 38.2% year over year. The operating margin increased 310 bps to 13.2%.
Zacks Rank and Other Stocks to Consider
Omnicom currently carries a Zacks Rank #2 (Buy).
A couple of other top-ranked stocks from the broader Zacks Business Services sector are Waste Connection (WCN - Free Report) and Viad Corp (VVI - Free Report) .
Waste Connection currently carries a Zacks Rank of 2. It has a long-term earnings growth expectation of 12.6%.WCN delivered a trailing four-quarter earnings surprise of 1.9%, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Viad Corp presently carries a Zacks Rank of 2. It has a long-term earnings growth expectation of 15%. VVI delivered a trailing four-quarter earnings surprise of 8%, on average.
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Omnicom Group Inc. (OMC - Free Report) reported impressive first-quarter 2024 results, wherein both earnings and revenues beat the Zacks Consensus Estimate.
Earnings of $1.67 per share beat the consensus estimate by 9.9% and increased 7.1% year over year. Total revenues of $3.6 billion surpassed the consensus estimate by 1.6% and increased 5.4% year over year.
The increase in the top line was led by an increase of 4% in revenues from organic growth and a 1.5% increase in acquisition revenues, net of disposition revenues, mainly due to the Flywheel Digital acquisition in the Precision Marketing segment.
Omnicom shares have gained 22.3% over the past six months compared with 10.4% rise of the industry it belongs to and the 16.9% rally of the Zacks S&P 500 composite.
Organic Growth Across Disciplines and Regions
Across fundamental disciplines, revenues from Advertising & Media increased 7% compared with our estimated growth of 6.4%. Precision marketing revenues jumped 4.3% compared with our estimate of 3.1% growth. Experiential revenues improved 9.5% compared with our expectation of 4.7% growth.
Public Relations revenues decreased 1.1% compared with our estimation of a 0.6% decline. Healthcare revenues increased 2.1% organically, year over year, versus our estimated growth of 3.8%. Branding & Retail Commerce revenues were down 3.8% versus our estimated growth of 1.3%. Execution and support declined 4.3% versus our estimated decline of 1.1%.
Across regional markets, year-over-year organic revenue growth was 4.3% in the United States, 3.2% in the U.K., 3.5% in Euro Markets & Other Europe, 22.3% in Latin America, 3% in Asia Pacific and 1.1% in Other North America. Middle East & Africa revenues declined 4.2%.
Margin Performance
EBITA in the quarter came in at $500.4 million, up 38.5% year over year. EBITA margin was 13.8%, up 330 basis points (bps) year over year. Operating profit of $478.9 million increased 38.2% year over year. The operating margin increased 310 bps to 13.2%.
Zacks Rank and Other Stocks to Consider
Omnicom currently carries a Zacks Rank #2 (Buy).
A couple of other top-ranked stocks from the broader Zacks Business Services sector are Waste Connection (WCN - Free Report) and Viad Corp (VVI - Free Report) .
Waste Connection currently carries a Zacks Rank of 2. It has a long-term earnings growth expectation of 12.6%.WCN delivered a trailing four-quarter earnings surprise of 1.9%, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Viad Corp presently carries a Zacks Rank of 2. It has a long-term earnings growth expectation of 15%. VVI delivered a trailing four-quarter earnings surprise of 8%, on average.
Free Report – The Bitcoin Profit Phenomenon
Zacks Investment Research has released a Special Report to help you pursue massive profits from the world’s first and largest decentralized form of money.
No guarantees for the future, but in the past three presidential election years, Bitcoin’s returns were as follows: 2012 +272.4%, 2016 +161.1%, and 2020 +302.8%.
Zacks predicts another significant surge. Click below for Bitcoin: A Tumultuous Yet Resilient History.
Download Now – Today It’s FREE >>
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